Are these Blue-Chips Cheap Now?

Since the start of 2014, the Straits Times Index  (SGX: ^STI), Singapore’s market barometer, is up by 3.5%. However, there are some index constituents that have been languishing at or near their respective 52-week lows. Let’s take a look three such shares now.

1. SIA Engineering Company Limited (SGX: S59)

SIA Engineering hit a 52-week low of S$3.91 last Friday. It has fallen by some 24% since its peak this year at S$5.14 in mid-July.

The firm, which does maintenance, repair, and overhaul work on aircraft, didn’t do well for the second quarter (the three months ended 30 September 2014) of its fiscal year. For that quarter, turnover was S$285 million, a decline of 3% year-on-year. Meanwhile, net profit plunged 41% to S$42 million. The reasons cited for the poor performance were declines in engine shop visits and heavy checks.

Going forward, a ”game-changing” joint venture with aircraft manufacturer Boeing provides some optimism for SIA Engineering’s future. The joint venture will provide airline fleet management and maintenance services for airlines that use Boeing’s aircraft in “the Asia-Pacific and beyond.” The Competition Commission of Singapore is currently seeking public feedback on the proposed move.

At its closing price last Friday, the aircraft engineering outfit has a price-to-earnings ratio of 16 and a dividend yield of 5.1%.

2. Global Logistic Properties Ltd (SGX: MC0)

The logistics facilities provider, which operates only in China, Japan, and Brazil currently, hit a 52-week low of $2.41 last Thursday. Global Logistic Properties closed at S$2.42 last Friday.

For the six months ended 30 September 2014, the company saw its revenue rise by 25% year-on-year to US$362 million. Global Logistic Properies may see huge growth just from China alone, which – as mentioned earlier – is a major market for the firm. Like my colleague Stanley mentioned, “less than 20% of all logistic warehouses in China can be considered as ‘modern’.” There’s a strong need for China’s logistics industry to improve, and this can play into Global Logistic Properties’ strengths as its bread and butter is the provision of modern logistics facilities.

Currently, Global Logistic Properties trades at a historical PE of 14 and has a dividend yield of 1.8%.

3. StarHub Ltd. (SGX: CC3)

Starhub’s shares hit a 52-week low of $4.03 in March this year and closed last Friday a smidge higher at just S$4.06.

For the third quarter of 2014, the telecommunication provider’s revenue went up 2.3% year-on-year to S$592 million while net profit increased 2.6% to S$97.7 million. The top-line growth was mainly due to an increase in handset sales;  the recently-launched iPhone 6 and iPhone 6 Plus had played a huge role there.

Starhub is now going at 19 times its historical earnings and has a dividend yield of 4.9%.

Foolish Takeaway

Shares that are near their respective one-year lows may present opportunities. However, investors would still have to do their own due diligence to see if their underlying business fundamentals are still intact and if their valuation makes sense at current prices.

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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 contributor Sudhan P doesn't own shares in any company mentioned.