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800 Super Holding Ltd Is Up 625% In 5 Years: Is It Still A Bargain Now?

800 Super Holdings Ltd (SGX: 5TG) is an established environmental services provider for both the public and private sectors in Singapore. The company’s services include waste disposal, cleaning and conservancy, and landscaping. In other words, 800 Super helps keep Singapore clean and green.

Although 800 Super is still a tiny company – its market capitalisation is around S$224 million at the moment – its returns have been anything but tiny. Over the past five years, 800 Super’s stock price has jumped by 625% in total.

This performance may raise a question in investors’ minds: Is 800 Super still a bargain now?

There is no easy answer since there are many ways to look at a company’s valuation. But, we can still get some insight by comparing 800 Super’s current valuations with the market’s.

The three valuation metrics I will focus on are the price-to-book (PB) ratio, price-to-earnings (PE) ratio, and dividend yield. I will be using the SPDR STI ETF (SGX: ES3) as a proxy for the market; the SPDR STI ETF is an exchange-traded fund that tracks the fundamentals of Singapore’s stock market benchmark, the Straits Times Index (SGX: ^STI).

Here’s a chart showing the PB ratios of 800 Super and the SPDR STI ETF:

800 Super and SPDR STI ETF PB ratio
Source: S&P Global Market Intelligence and SPDR STI ETF website

In terms of the PB ratio, 800 Super is clearly way more expensive than the market (a PB ratio of 3.07 vs. 1.21).

The next chart shows the PE ratios for both 800 Super and the SPDR STI ETF:

800 Super and SPDR STI ETF PE ratio
Source: S&P Global Market Intelligence and SPDR STI ETF website

Although 800 Super has a higher PB ratio than the market, its PE ratio of 11.3 is actually at a 14% discount to the SPDR STI ETF’s PE ratio of 13.1.

Here’s a chart showing the dividend yields of 800 Super and the SPDR STI ETF:

800 Super and SPDR STI ETF dividend yield
Source: S&P Global Market Intelligence and SPDR STI ETF website

800 Super has a yield of 2.8% at the moment, which is slightly lower than the SPDR STI ETF’s yield of 2.97%.

So, in summing up what we’ve seen, despite having a lower PE ratio, 800 Super is priced at a premium to the market given its higher PB ratio and lower dividend yield. Investors who are thinking about investing in the company should consider whether 800 Super can sustain its current earnings power.

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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.