The FTSE Value-Stocks ASEAN Index uses a proprietary screen to identify value stocks from ASEAN.
The index uses a criterion which looks at valuation, quality factors, and contrarian factors. On the valuation front, the index uses the price-to-earnings (PE) ratio as its main selection determinant. Once all the companies that fit into its screening criteria are selected and ranked, the 50 companies with the lowest PE ratios are selected for the index.
SGX recently released a report, looking at the performance of the 10 Singapore companies included in the index. We looked at five from the list here. Today, let’s take a look the other five (figures as of 13 Aug 2018, unless otherwise stated):
1. Mapletree Logistics Trust (SGX: M44U) is the third, real estate investment trust (REIT) to be included in the value index. The REIT offers a distribution yield of 6.2%. Over the past ten years, Mapletree Logistics Trust has clocked in a total return of 255% and it currently trades at a PB ratio of 1.0.
2. Oversea-Chinese Banking Corp Limited (SGX: O39) is second bank in the list. OCBC offers a lower yield compared to DBS Group Holdings at 3.3%. Over the past ten years, OCBC has also lagged DBS in terms of total returns which stood at 111%. OCBC trades at a PB ratio of 1.3.
3. Singapore Telecommunications Limited (SGX: Z74), at a market capitalisation of $50.6 billion, is the only telecom company on the list. The telco sports a dividend yield of 5.6% and trades at a PE ratio of 9.5. In the last ten years, Singtel has generated 47.5% in total returns.
4. United Overseas Bank Ltd (SGX: U11) is the third and final bank to be included in the index. UOB has a market capitalisation which stands at S$44.7 billion. The past ten years have seen it reward patient investors with total returns of 103.5%. The bank is currently trading at a PB of 1.0 and dishes out an attractive 4.5% dividend.
5. Venture Corporation Ltd (SGX: V03) rounds up the list of the ten Singapore companies on the list. The electronics manufacturing services (EMS) provider offers a 4.5% dividend yield and is currently trading at a PE ratio of 12.3. Venture Corporation has churned out respectable returns over the last ten years with returns clocking in at clocking in at 220.4%.
That rounds up the list of 10 Singapore companies that are included in the FTSE Value-Stocks ASEAN Index.
Over the past ten years, these Singapore-listed companies have returned a staggering 155% in average total returns. The strong performance exceeds the total returns of the FTSE Value-Stocks ASEAN Index itself. Picking the right companies makes a difference. If we get it right, our stocks can can produce outsized gains.
For more investing insights and to keep up to date on the latest news in the world of finance, you can sign up now for a FREE subscription to The Motley Fool's weekly investing newsletter, Take Stock Singapore. Written by David Kuo, it will teach you how you can grow your wealth in the years ahead.
Also, like us on Facebook to follow our latest hot articles. The Motley Fool's purpose is to help the world invest, better.
The Motley Fool Singapore contributor Esjay contributed to this article.
The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of Singapore Exchange, and United Overseas Bank. Motley Fool Singapore writer Chin Hui Leong owns shares in Mapletree Logistics Trust, and Singapore Exchange. Motley Fool Singapore contributor Esjay owns shares in Singtel.