Singapore Press Holdings Ltd (SPH) still offers an attractive yield even after the media and property firm reported a 5.9 percent fall in 2012 net profit mainly due to lower investment income, brokers said.
SPH shares were up 0.5 percent at S$4.09 on Monday. The stock has risen nearly 11 percent so far this year versus the 15 percent gain in the broader Straits Times Index.
SPH posted net profit of S$365.5 million ($299.3 million) for its financial year ended August, down 5.9 percent from a year earlier. The company announced full-year dividend of 24 Singapore cents, representing a yield of nearly 6 percent.
Maybank Kim Eng said the yield spread between SPH and 10-year government bond is now 443 basis points (bps), above the historical average of 350 bps.
The broker expects SPH to declare a dividend of 25 Singapore cents for 2013 fiscal year, implying yield of 6.2 percent which it said is still very attractive. Maybank raised its target price to S$4.50 from S$4.43 and kept its ‘buy’ rating.
CIMB Research, which has an ‘outperform’ rating and S$4.39 target price, said SPH’s property business remains the star performer and could help drive dividend payout in 2013. Both Paragon and Clementi malls had rental increases this year, CIMB noted.
OCBC Investment Research said falling margins highlighted the increasing uncertainties for SPH’s core print business, but SPH’s dividend yield is likely to limit the share price downside. OCBC has a ‘hold’ call and S$4.05 target price.
(Reporting by Eveline Danubrata in Singapore; firstname.lastname@example.org); Editing by Jijo Jacob
10:27 STOCKS NEWS SINGAPORE-Synear surges after bid to take company private
Shares of Synear Food Holdings Ltd surged after its main shareholders offered to take the Singapore-listed Chinese frozen food producer private, valuing the company at nearly S$256 million ($210 million).
Synear’s executive chairman, Li Wei, and his affiliates already hold 50.13 percent of Synear’s issued shares. Their vehicle, Fortune Domain Ltd, offered to buy the remaining shares at S$0.186 each.
On Monday, Synear shares rose as much as 6.9 percent to their highest intra-day level since April 2011, matching the offer price. More than 28 million shares were traded, about 17 times the average full-day volume over the past 30 days.
Synear was the top-traded stock by volume in the Singapore market on Monday. Before the offer announcement, the stock had gained 35 percent this year versus the 24 percent gain in the FT ST Small Cap Index.
Bosses of Singapore-listed companies are taking their firms private to take advantage of beaten-down prices and cheap financing, more than trebling management buyout deals in the island-state to $10.9 billion compared with the whole of 2011.
Reporting by Eveline Danubrata in Singapore; Editing by Prateek Chatterjee; email@example.com $1 = 1.2211 Singapore dollars