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Stocks That Could Do Well

As sure as night follows day, the Year of the Goat follows the Year of the Horse. So as the imperious horse canters back to its paddock for a well-earned rest, what can we expect from the sure-footed Goat?

Perhaps the one thing that we can always count on at around Chinese New Year is astrological predictions, aplenty.

Around this time of year, geomancers and feng-shui experts will be out in numbers to give their two cents’ worth on what could transpire in financial markets in the New Year.

The obliging goat

But it is important to remember that no one drops a flag at the start of Chinese New Year to signify that goat-related stocks should start to perform well. Investments are never quite so obliging.  Financial events do not happen in convenient calendar blocks.

Mind you, the start of the Year of the Goat does give me an opportunity to talk about companies that have done well in the past. They might even continue to perform well not only this year but for many years to come too.

The creative goat

For instance, the Goat is said to be one of the most creative of the twelve Chinese zodiac signs. This could augur well for Kingsmen Creatives (SGX: 5MZ), which, it has to be said, seems to do well regardless of external astrological influences.

The company, which produces exhibition displays for trade shows, has managed to grow revenues continually under each of the 12 Chinese zodiac signs.

The Year of the Rooster, incidentally, was especially good. That was the year when Kingsmen paid its maiden dividend. But I am not counting my chickens just yet for a hike in dividends. The distribution has been stuck at $0.04 a share for the last few years.

The artistic goat

The Goat is also believed to be closely associated with the arts. This should not be taken as a call to rush out and buy the first available watercolour that you happen to clap eyes on.

Many of us don’t know our Degas from our Picasso. I certainly don’t. So, I am going to stick to the radio, television, music and magazine industries, instead. That is about as arty as I will ever get.

So, cue Singapore Press Holdings (SGX: T39). The publisher of around 100 magazine titles has been one of Singapore’s most consistent dividend payers since the turn of the Millennium. Currently, shares in the owner of The Straits Times, are yielding around 5%, which is higher than the market average.

The fashion goat

Finally, the Goat is supposed to pay closer attention to its appearance. So, never let it be said that the Goat is scruffy.

Could this bode well for the fashion industry? Could this also be the year when households, whose disposable incomes have been unexpectedly boosted by falling energy prices, finally whip out their wallets and kick-start a consumer-led economic recovery?

If so, it could be music to the ears of shopping mall owners. These could include SPH REIT (SGX: SK6U), which owns the upmarket Paragon shopping mall. It could also benefit CapitaMall Trust (SGX: C38U), whose portfolio of shopping destinations includes Plaza Singapura, Bugis Junction, The Atrium@Orchard and Raffles City.

So, could the Year of the Goat be a good time to invest in the stock market?

The answer can probably best be summed up by one of my favourite Warren Buffett quotes. He said: “Investing is laying out money today to receive more money tomorrow.

Therefore, the secret to successful investing is to know how much we are paying for an investment now and how much we are likely to receive in the future. We won’t find the answer in a horoscope but we could by reading company reports.

A version of this article first appeared in Take Stock Singapore. To get your personal Take Stock delivered directly to your inbox simply click here now.

Take Stock - Singapore is The Motley Fool's free investing newsletter. Written by David Kuo, Take Stock - Singapore tells you exactly what's happening in today's markets, and shows how you can GROW your wealth in the years ahead.

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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 Director David Kuo doesn’t own shares in any companies mentioned.