MENU

Wilmar International Limited’s Stock Price Is Near A 52-Week Low Now: Is It Cheap?

Wilmar International Limited (SGX: F34) is an agricultural company that has three main business segments: Tropical Oils; Oilseeds and Grains; and Sugar.

Over the last 12 months, Wilmar’s stock price has fallen by 11% to S$3.16 currently. This is just a whisker higher than a 52-week low of S$3.08. Some investors may thus be wondering: Is Wilmar’s stock actually cheap?

There’s no easy answer since there are many ways to look at a company’s valuation. But, we can still get some insight by comparing Wilmar’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).

Wilmar currently has a PB ratio of 1.0, which is slightly lower than the SPDR STI ETF’s PB ratio of 1.3. The PE ratio for both also has a similar dynamic, as Wilmar is a little cheaper than the SPDR STI ETF (PE ratios of 10.9 vs 11.2). The dividend yield is where Wilmar loses out to the market. The company has a dividend yield of 2.1%, which is lower than the SPDR STI ETF’s yield of 2.9%. The higher the yield is, the lower a stock’s valued.

In sum, we can argue that Wilmar is currently priced at a similar level to the market, given its slightly lower PB and PE ratios, but lower dividend yield.

If you like what you've seen, you can get even more investing insights and analyses from The Motley Fool's investing newsletter Take Stock Singapore. It's FREE, so do check it out here.

Also, like us on Facebook to follow our latest news and articles. The Motley Fool's purpose is to help the world invest, better.

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.