3 Things Investors Should Know about Straco Corporation Ltd

Straco Corporation Ltd (SGX: S85) is a tourism asset operator with operations in China and Singapore.

In China, the company has the Shanghai Ocean Aquarium, Underwater World Xiamen, and Lintong Lixing Cable Car attractions under its umbrella. As for Singapore, Straco had bought a majority stake in the iconic Singapore Flyer – one of the largest observation wheels in the world – in late 2014.

Here are three things investors may want to know about Straco:

1. Growing revenue and earnings for the last 10 years

Straco has managed to grow both its revenue and profit substantially over the past decade.

In 2005, the tourism asset operator had S$18.1 million in revenue and S$3.0 million in profit. In 2015, those numbers have jumped to S$127.7 million and S$49 million, respectively. For perspective, Straco had grown its revenue at a compound annual rate of 21.6% and its profit at 32.2%.

2. A history of rising dividends

Straco first paid a dividend in 2006. Back then, the payout was just 0.25 Singapore cents. Since then, the company has not just paid an annual dividend in each year – it has also either maintained or raised its dividend. In 2015, Straco’s dividend came in at 2.5 cents per share.

At the company’s current share price of $0.81, it has a dividend yield of 3.1% thanks to its 2015 dividend.

3. Current valuation in relation to history

Straco is carrying a price-to-earnings (PE) ratio of 14.3 at the moment.

Straco PE ratio since 17 June 2011
Source: S&P Global Market Intelligence

As the chart above shows, the company’s current PE is near the middle of where it has been over the past five years.

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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 Lawrence Nga doesn’t own shares in any companies mentioned.