Dividend Stocks In Singapore : Three To Watch

Singapore's Central Provident Fund (CPF) Special Account is known for its relatively high-interest rate, providing Singaporeans with a secure and conservative investment choice for their retirement savings.

However, some investors seek opportunities to earn higher returns through the stock market. Despite market fluctuations, certain Singapore stocks offer dividend yields that exceed the CPF Special Account's interest rate of 4.08%, effective from July 1, 2024, to September 30, 2024.

It's noteworthy that dividend yields are not guaranteed, and investment in stocks carries risk, including potential loss of principal. For those considering this investment path, here are three Singapore-based companies, each at a different point in their financial performance cycle.

Far East Hospitality Trust's (SGX: Q5T)

With a portfolio of 12 properties valued at around S$2.5 billion as of December 31, 2023, Far East Hospitality Trust (FEHT) represents the resilience of the real estate and hospitality sector in Singapore. Investors looking for exposure to these industries, along with possible dividend income, may consider FEHT's assets and their income-generating potential.

Uni-Asia Group's (SGX: CHJ)

Uni-Asia Group (UAG), another company to consider, reported a net profit of US$5 million for 2023, a drop of 82% year-on-year. While this decline could raise concerns about the stability of future dividends, it's crucial for investors to delve into the reasons behind the decrease and Uni Asia Group's plans for turning its fortunes around.

UMS's (SGX: 558)

Technological and manufacturing markets can present lucrative dividend opportunities, a category wherein UMS operates. However, UMS reported a sizeable revenue decline of 33% in Q1 2024 to S$54 million, paired with a 44% decrease in net profit, amounting to S$9.8 million. Given these figures, investors should assess the company’s ability to sustain dividends amidst market headwinds.

While the CPF Special Account offers a secure, government-backed interest rate, investors willing to assume higher risks have choices in the Singapore blue chip stocks with the potential for greater yields. All companies and stocks come with its own set of financial dynamics, and it's essential for investors to conduct thorough due diligence.

The search for higher dividends should be balanced with an understanding of the risks involved and an assessment of one’s financial goals and risk tolerance.