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Three Shares That Beat the Market Today

Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on changes — just in case they’re material to our investing thesis.

Singapore’s stock market barometer, the Straits Times Index (SGX: ^STI), has slipped slightly by just 0.1% to 3,272 points. Within the index, 15 of its 30 constituents had made losses while 10 others managed to make some headway.

Although the market bellwether has had a rather nondescript performance for the day, that’s certainly not the case for some shares outside the index. Let’s take a look at a few market beaters.

Electronics manufacturer Valuetronics Holdings (SGX: BN2) gained 2.7% to S$0.385 after releasing its full-year earnings this morning. For the financial year ended 31 March 2014 (FY2014), the company had seen its top-line grow by 10% to HK$2.43 billion. Meanwhile, its profits had spiked by 88% to HK$148 million.

The company’s revenue had expanded on the back of “stable growth” from both its Consumer Electronics and Industrial & Commercial Electronics customers. Slathered on top of higher demand from customers were higher profit margins (both gross and net margins) due to a shift to higher-margin products. That had led to Valuetronics’ impressive bottom-line growth.

Shareholders looking for dividends would also have much to cheer about the company’s earnings. For FY2014, Valuetronics will be dishing out HK$0.20 per share in total dividends (comprising of a final dividend of HK$0.16 and a special dividend of HK$0.04). This compares against an annual dividend of only HK$0.08 for FY2013.

Logistics outfit Goodpack (SGX: G05) is up 4.3% to S$2.44 after news broke yesterday that private equity firm KKR is seeking to acquire the company at S$2.50 a share. At that price, KKR is pegging Goodpack to be worth S$1.39 billion in its entirety.

The acquisition is still subjected to approval from Goodpacks’ shareholders, who might be thinking about whether the price is fair or not. For KKR though, a major hurdle to the deal has been cleared with David Lam, chairman and largest shareholder of Goodpack (with a 32% stake), agreeing to sell all his shares.

JK Tech Holdings (SGX: 5TS) rounds up the list with its shares jumping 9.9% to S$0.665 following a very favourable full-year earnings release yesterday evening for its financial year ended 31 March 2014 (FY2014). The company’s annual revenue had grown by 50% to S$33 million while profits actually ballooned by 305% to S$1.08 million.

It’s worthwhile pointing out that this particular set of results came from the company’s legacy business of providing information technology solutions. In April this year, JK Tech Holdings had announced a shift in its business direction to include the exploration and production of oil & gas assets; the company was of the opinion that its legacy operations “may face challenging business conditions in light of the shortage of qualified staff in the market” among other difficulties.

As part of the strategic shift, the company also issued new shares and options in a private placement deal to upstream oil & gas support services provider Ezion Holdings (SGX: 5ME) and investment outfit SF Ventures. The private placements would see both become JK Tech’s largest shareholders. In particular, Ezion would end up owning roughly two-thirds of JK Tech if it exercises all its options. At that time, all the changes proposed by JK Tech were subjected to its shareholders’ approval; the company’s shareholders have since given their seal of approval on 22 May 2014.

Despite the strength that JK Tech Holdings has seen from its legacy business for FY2014, the company still thinks that tougher times are ahead and that it’s still best for the company to diversify into an entirely new line of business.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore writer Chong Ser Jing doesn’t own shares in any companies mentioned.