Thursday, February 05, 2015

Why You Should Consider Investing in Singapore Stocks

Back in 2010 (it's hard to believe that was five years ago), I wrote about the country of Singapore  and the top Singapore stocks. Since then, Singapore has made some major improvements.

 For example, five years ago, it was the 18th wealthiest country in the world in terms of GDP per capita on a purchasing power parity basis. Now it is in third place. As for the Human Development Index, it was ranked 25th place; now it is number nine. In addition, the country now has has the world's highest percentage of millionaires. Plus, multinational companies in Australia and other countries now move money through financial hubs in Singapore than at any time in history.

What all this means is that maybe investors should take a closer look at Singapore stocks. For example, Avago Technologies (AVGO) designs and markets semiconductor devices concentrating on analog III-V based products. The stock has a very high trailing price to earnings ratio at 107, but a very favorable P/E at 13. Earnings for the latest quarter were up 115.4%, however earnings dropped by 21.5%. The company pays a yield of 1.4%.

Don't let the name fool you but China Yuchai International (CYD) is actually a Singapore company. It has China in its name because the company makes and markets diesel and natural gas engines primarily in the People’s Republic of China. The stock trades at six times earnings and pays a fat 6.6% yield.

Flextronics International (FLEX) is another Singapore company which provides design, manufacturing, and supply chain services to original equipment manufacturers. It trades at 14 times trailing and 10 times forward earnings. It does not pay a dividend.

However, the best way to invest in Singapore may be to just invest in the iShares MSCI Singapore Index (EWS) ETF. If you like stock lists of different countries list this list, you can access many free country stock lists at, such as Brazil, Canada, China, Cuba, Mexico, Spain, and the UK.

Disclosure: Author didn't own any of the above at the time the article was written.


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