Yield Watch:Starhub and M1 pushes ahead
My Dividend Stock Tracker have been updated with the daily figures. Market have rebound nicely and particularly the main darling have been Genting International.
Yangzijiang have also been on a healthy climb but what is slightly less under the radar was a shift in funds towards the telcos Starhub and M1.
Yields have fallen to 6.1% for M1 and Starhub at 8%. Those are still very good dividend yields. But are they undervalued now? I think not.
For sure they provide good yields but if you buy it at a high, your capital loss might end up greater than your dividends. EV/EBITDA at 8.9 times and 6.7 times are low and probably shows how easy it is for telcos to clear their equity and debts.
Of Analysts predictions
What I want to mention about abit is that some analysts have upgraded Starhub these 2 days:
Starhub raised to Outperform by Daiwa, raised target by 22.1%
Daiwa upgrades Starhub (CC3.SG) to Outperform from Hold, raising target price to $2.65 from $2.17 after changing valuation basis to dividend discount model from discounted cashflow methodology, says Dow Jones.
Daiwa says telco offers attractive dividend yield, well positioned to gain market share in corporate broadband market with launch of Singapore’s high-speed national broadband network.
“Our analysis suggests that the opportunities in the corporate market will more than offset the risks the company faces in the residential segment,” says Daiwa, who expects revenue growth for mobile business to be driven by increasing number of data-plan users, higher demand for inbound roaming services.
What I find it funny is how come a month or 2 ago, this stock was deemed overvalued or fully valued and now it is deemed attractive. Could fundamentals have changed so much in 2 months? For a telco for the matter?
The article below points to possibly why there are active movements of late:
StarHub up on corporate business hopes
Singapore’s second-biggest telecom firm StarHub <STAR.SI> rose as much as 3.7% to a 22-month high on Wednesday on hopes the island’s new fibre-optic network may help the firm to get a bigger slice of the corporate data segment.
At around 11:00 a.m., StarHub’s shares were traded at $2.52 with over 2.9 million shares changing hands.
“With the roll out of the new network, we foresee StarHub making more headway in the corporate space as they will be able to sell more (data) services to schools, financial institutions etc.,” said Carey Wong, an investment analyst at OCBC Investment Research.
Singapore’s new fibre-optic network opened for business on Wednesday.
NBN isn’t new stories. Its been mentioned again and again so only now the public pays attention to this?
What we can learn from this is that while fundamental analysis does not always work in all stocks you analyse, but if you do it well and do a deep research on it way before the public got notice of it, you might be able to hit some good gains.
The downside is always:
- You thought you have a gem, turns out your skills are actually bad.
- The company screws you as it window dresses so well that you actually think you have a gem.
- It’s a gem but its value doesn’t get realised for years.
Investing sometimes is a funny game. You cannot say its hard, yet not many people make money consistently. For me, fundamental analysis is a necessary screen for all long term purchases but it isn’t the only deciding factor. Whether its fundamental or technical, if you don’t put work into it, it will screw you up more than it will help you.
I run a free Singapore Dividend Stock Tracker available for everyone’s perusal. It contains Singapore’s top dividend stocks both blue chip and high yield stock that are great for high yield investing. Do follow my Dividend Stock Tracker which is updated nightly here.
S&P 500($SPX) and Major Indices in range mode.
It’s been a few slow weeks for me as well as the markets. I have not been doing much on the investment front recently and really it’s a difficult market to invest.
Trading is another story.
1130 is the resistance that the bulls just could not get across but sentiments recently have been rather lukewarm. The number of bulls are being turned by this lethargic markets.
Recent sell downs have been rather drastic. Volume is higher on selldowns then uptrends. Breadth indicates market is short term oversold.
3 Forward Ways:
- Range bound trading within 1130 and 1040.
- Market is so weak that i t fails the EMAs congested just above.
- The reverse head and shoulders herald a continuation of upward climb.
All very likely scenarios and the thing is to make decisions, take actions and then react based on your plan.
I run a free Singapore Dividend Stock Tracker available for everyone’s perusal. It contains Singapore’s top dividend stocks both blue chip and high yield stock that are great for high yield investing. Do follow my Dividend Stock Tracker which is updated nightly here.
Yield Watch:Long Term trends are fuzzy
My dividend stock tracker have been updated tonight. You can check it out there @ Dividend Stock Tracker.
My friends have on and off asked me if I have new purchases. I don’t really like how the EMA for SP500 and STI is moving currently. S&P500 looks deciding more bearish then the STI.
Because of this reason, I am holding more of my purchases and to wait for a clear sign. Markets are short term oversold so if you wanna short for short term there is no beef there.
Understanding Cancer:How to stop Cancer by eating the right food
Here is a great video on how cancer work and how cancer can spread and how regulating food can prevent it. Worth a watch
AIA taking steps to stop poaching of Agents
Take a look at this article. I Got it off Patrick Lim’s blog.
If you are an insurance agent would you be enticed by these perks?
Aug 18, 2010
AIA pulls out all stops to plug manpower leak
Hit by staff exodus, insurer goes on ‘retaliation’ drive
By Lorna Tan, Senior Correspondent
INSURER AIA is countering poaching raids by rivals by paying huge bonuses to retain top agents while offering recruits up to 135 per cent of their previous year’s income as a sign-on sweetener paid upfront.
The AIA ‘retaliation’ programme is in response to an exodus of its agents to other insurers. Some experts estimate the company has lost about 700 agents from last year.
The initiatives are aimed at bolstering existing staff numbers while providing incentives for other firms’ agents to jump ship.
The ’sign on’ provision of up to 135 per cent of the previous year’s income is the most dramatic and easily trumps the 30 per cent upfront sign-on bonus offered by some insurers. At most, such insurers cap their incentive handouts at double an agent’s previous annual income.
AIA will also offer an additional benefit of up to 125 per cent of the previous annual income to be paid over the following three years, subject to conditions.
This could mean a recruit gets a total benefit of up to 260 per cent of his previous annual income.
So if an agent earned $300,000 in his previous job, he could stand to collect $780,000 over three years at AIA. But if sales quotas are missed or the agent leaves prematurely, AIA will claw back the benefit. The sign-on incentives are on top of the usual AIA commissions an agent earns from sales.
AIA also aims to stem the exodus of its own agents with a retention package – or ‘golden handcuffs’ – for top performers. A source told The Straits Times that AIA has already paid millions to its top producers to ensure that they stay.
In response, the Monetary Authority of Singapore (MAS) noted that aggressive or excessive poaching of agents by insurers is not a healthy practice.
’This could lead to undesirable consequences such as improper switching of policies and pressure selling by poached agents to fulfil the conditions of their migration,’ said a MAS spokesman.
It urged insurers to get together to exercise self-regulation as they have done in the past.
Improper switching occurs when clients are misled into surrendering a policy, resulting in a financial loss, so the proceeds can be used to buy a new plan with another firm.
The other weapon in AIA’s arsenal is a bonus plan under which agents can earn a $2,000 fee if they successfully refer another agent to the company.
If the recruited agent stays for a year, the agency manager can earn $10,000 over 12 months, subject to sales conditions being met.
AIA declined to provide the exact size of its agency force yesterday but it is believed that the firm now has about 3,300 agents, down from 4,000 last year. Prudential has 3,800 agents and Great Eastern 2,800.
Mr Kenneth Juneau, executive vice-president and senior regional executive and chief executive of AIA Singapore, recently said that it expects to recruit 1,000 agents this year.
Industry observers believe AIA’s strategy is an aggressive initiative designed to beef up its agency force before its initial public offering expected at the end of the year.
In the life insurance industry, big is seen as better as a larger force is expected to bring in higher sales.
The insurers’ aggressive tactics hit the headlines last November when The Straits Times reported that some companies were paying a lump sum upfront, with the total amount capped at the average of an agent’s last two years of income.
But the sign-on offers have shot up since, sparking massive poaching.
MAS added that it expects insurers to have proper recruitment standards to ensure that the agents they appoint are fit and proper. In addition, all insurers are required to have in place policies and procedures to monitor and detect improper switching activities.
’We will not hesitate to take supervisory action against insurers whose agents engage in inappropriate behaviour stemming from aggressive poaching activities,’ said MAS.
It emphasised that the charging of such recruitment and retention packages should be borne by the shareholders’ fund, and not the insurance or participating (par) fund which is accumulated from policyholders’ premiums.
This is because insurers are required under the Insurance Act to ensure that assets of an insurance fund are applied to meet the insurers’ liabilities and expenses only where they are attributable to the fund.
Still, Singapore Insurance Institute president Stanley Jeremiah called for clear regulations to protect the par policyholders from excessive sales incentives, recruitment and retention cost being charged to the par fund.
lorna@sph.com.sg
PERKS FOR RECRUITS
# Sign-on provision of up to 135 per cent of previous year’s income
# Up to 125 per cent of previous year’s income paid over three years
KEEPING TOP AGENTS
# ‘Golden handcuffs’ of millions of dollars paid out as bonuses to top agents to ensure they stay
REFERRAL BONUS
# Agents get $2,000 for successfully introducing new agent to firm $10,000 to agency manager if new agent stays for a year and performs well
Yield Watch:REITs doing well today. Blog Awards: Top Stock Market Blog!
I haven’t been taking a look at market much as I have been involved in some things other than investments.
But its good to see the REITs and Yield Stocks holding up well in this small correction.
But I urge caution as the trend seems to be pointing lower.
Your yield stocks if you bought at a right price should give you time to maneuver should things get ugly.
Singtel Looks to be showing signs of weakness and it is one of the largest blue chip stocks on the SGX. As a telco stock I like its payout ratio and although it doesn’t yield as much as M1 or Starhub its payout ratio is much lower much sustainable. Could be a good pickup.
Top Stock Market Blog
I got to know that I was part of a group of blogs raised as top stock market blogs in 2010.
I would like to thank you readers for your support these past 4 years and hope to deliver more alternative and informative content to provide you with a better investment sensing.
I run a free Singapore Dividend Stock Tracker available for everyone’s perusal. It contains Singapore’s top dividend stocks both blue chip and high yield stock that are great for high yield investing. Do follow my Dividend Stock Tracker which is updated nightly here.
Be Frugal: 3 Ways to control Tech Gadget Spending
Spending on Gadgets seems to be the past-time of many men and boys.
I have dabble in my love for Gadgets for a long time since my secondary school days. Back then, money was really hard to come by and whenever I spend on such stuff, I feel a sense of guilt because although I am curious about how they work, spending on them means I will have to forgo something that matters to me.
After I started working, the budget constraints gets relaxed and while I can realistically buy an iPhone every month, it is ridiculous to do that.
1. Enjoying the process of researching/finding out about the Gadgets
I realize that the curiosity to identify how things work and the difference between each brands and trival details can be a form of experience that I grew to like. That is why I started a blog www.productiveorganizer.com to talk about mobile productivity and softwares in general.
I realize that much of the utility for a lot of people probably happens DURING the process of researching for it and gets reduced a lot after the anticipation, and the purchase have been carried out.
Knowing this, I controlled my urge to purchase much better and learn to maximize what increases my utility levels.
2. Assigning a budget per year for Tech Gadgets
Tech Gadgets should be treated as a hobby and as such, it would be best to assign a budget for it. Having a budget means it is likely that you are constraint to spend only this much on tech gadgets and when it runs out, you better not spend anymore.
For me, I budget SGD40 per month to spend on this hobby via Envelope Budgeting . If you are familiar with this realm, you will know that 40 bucks really buys shit in today’s world.
So this would mean that I only have 40 * 12 = 480 bucks to spend on my gadget hobby.
3. Sell Old Gadgets to finance for new ones
A lot of my friends doesn’t do this because of attachment to the gadget or the reluctance to part with the gadget because of the huge depreciation in gadget value.
Gadgets drop in value pretty fast and the only way that your gadgets can still maintain or even be of higher value then purchase is if you are shrewd enough to import from overseas at a cheaper price and sell it locally.
To this all I can say is: If you leave it lying in your house, it is likely that
- You will never look at it again
- The value can never be higher than what it was worth n-months ago
- You will eventually throw or give it away
So my rule of thumb is that if I deem that it has some sizable stored value, I will sell it away.
I bought my current iPod Touch 3G for SGD480 but essentially finance this by selling away my iPod Touch 2G for SGD230, which was bought at SGD330.
Another good friend of mine looks to spend quite a fair bit on his sound system. But turns out that he is pretty shrewd to import them from overseas and when he grew tired of them, the price he sold it was not far from his purchase price!
It pays to:
- Know the value of what you are playing with. Certain high price gadgets hold value better than those cheapo gadgets.
- Leverage on overseas opportunities.
- Sell it off the moment you think its not working out for you. There is a cost to procrastination.
Should you use Ad-free blockers for Android and iPhone?
This is a thought provoking question to ask. I got to know this application over from Lifehacker which introduces an application for ROOTed phones that will block ads from displaying on your Android device.
The question is why does the developer include advertisements in the first place? I have written here that not all international developers are able to list their apps as paid version and thus go the ad support route.
This is so that they can monetize the application.
Incentive to innovate and maintain the application
Why is this important? The developers are spending their time to support, maintain and improve the application.
And while we shouldn’t be jealous that they are earning from it, we should be enabling them to have this incentive to continue to innovate and improve.
So what do you guys think? This is probably a good application but this places the developer at a very big disadvantage.
Scarlett Johansson, Ryan Reynolds:Frugal Celebrities?
This great looking couple got into the news today on rumours that they are going to buy a 2.8 million dollar home in LA.
2.8 million seems to be peanuts in Hollywood. Sounds to me that this couple don’t seem to be the sort that would want to flaunt their wealth.
Fwah Moment:How to budget for a divorce
Here is a good illustration showing the thought process that is necessary should you be going into a divorce or facing a similar situation.
Monetary planning might not be the most important thing but it is something that could bring about additional emotional stress.
I bought Starhub at a time where many of...
RSS
Twitter
Buzz
