3 Things Investors Should Know About Jardine Strategic Holdings Limited

Jardine Strategic Holdings Limited (SGX: J37) can be considered to be a conglomerate given its majority stakes in other Singapore-listed companies such as Dairy Farm International Holdings Ltd (SGX: D01), Jardine Cycle & Carriage Ltd (SGX: C07), and Hongkong Land Holdings Limited (SGX: H78).

These companies are in diverse sectors. Dairy Farm is a bricks-and-mortar retailer; Jardine Cycle & Carriage is itself a conglomerate with business interests in automotive distribution, financial services, logistics, agriculture, and more; Hongkong Land develops and invests in real estate mainly in Hong Kong, China, and Singapore.

Here are things about Jardine Strategic Holdings that investors may want to know:

1. Consistently profitable over the past decade

Jardine Strategic has been consistently profitable over the last 10 years. Besides, its profit attributable to shareholders has grown from US$1.40 billion in 2005 to US$1.95 billion in 2015.

Some factors that may help explain that consistency would be the conglomerate-nature of Jardine Strategic’s business. A diverse income stream from many different companies has helped jardie Strategic to sustain its overall profitability even when fluctuations have been seen in individual business units.

2. Consistently growing dividend

Jardine Strategic is one of the rare companies in Singapore’s stock market that have managed to increase its annual dividend in each year over the last 10 years. You can see how the company has grown its dividend from US$0.16 per share in 2005 to US$0.285 in 2015 in the table below:

Jardine Strategic's dividend per share
Source: S&P Global Market Intelligence

At the company’s current share price of US$28.82, its dividend yield is 1%.

3. Valuation

Jardine Strategic has a price-to-earnings (P/E) ratio of 8.4 at its current share price.

Jardine Strategic's PE ratio since 27 June 2011
Source: S&P Global Market Intelligence

While that appears low – the market’s P/E is now around 11 – it’s worth noting that Jardine Strategic’s P/E at the moment is near the higher-end of where it has been over the past five years as the chart above shows.

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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.