This could both mean good or bad, as liquidity and credit concerns might be looming over them.

I have added 2 stocks to my dividend stock tracker this morning. They are Singapore Post and Micro Mech. Singapore Post’s share price have been pretty stable, up until the last month,where it followed the broad market into a quick drop. However, I believe fundamentally, it holds a pretty strong balance sheet and the economics of the business should see it sail through the rough waters.

Micro-Mech is one of the stocks that i want to get a hold of, but found that perhaps i should have gotten it much more cheaper. It too have been pretty resilient this year however, this thinly traded stock is now at 42 cts. A dividend yield of 11% indicates value for a company with no debts and very strong free cashflow. If there is any indication that this semi conductor stock will fare badly in this recession, it is how they operate throught the nasty 2001-2003 recession, which they did with flying colors.

Dividend and Cashflow Yield will drop

One thing about dividend yields or cashflow yield is that they are usually based on historical cashflow and earnings. Investors should always evaluate what are the kind of earnings going forward for the next 5 years.

Take the example of Courage Marine, the Baltic Dry Shipping Index fell from > 12000 to <1000. Thats a humongous drop and it impacts the shipping industry. Courage Marine for the previous year had enjoyed a bumper year in earnings and this could very well reverse this year due to a global oversupply of shipping vessels.

However, i believe its cash and debt position is still one of the best in the industry. Using 2.2 cts as a dividend payout is a very conservative estimates, since this years payout is nearly 10 times of that. Thus 18% is a pretty good yield from a valuation perspective.

Based on last years ebitda, its EV/EBITDA is 0.4 times which means it takes less than half a year to get your money back! That is if earnings stays the same, which is very unlikely.

PTB at 0.8 times and cash is 73% of market cap indicates that you aren’t paying too high a price  for this.

Asset Value will fall as well

I believe some of these stocks will see net asset values declining, especially the REITs and property stocks.

Taking a look at MacArthurcook Industrial REIT, its PTB is 0.2 times. You either think that this REIT overpaid its properties by 80 times or that it is really undervalued here.

Dividend yield is among the highest among REITs at 19%. So is this a steal?

Not quite. Interested dividend investors and REIT investors should also look at

• Theme of REIT and the prospects/risks going forward (Hospitality, commercial, industrial,healthcare,retail)
• The quality of assets that the REIT owns
• The gearing, tenure and renewal of debts. money is getting scarce, which creates a big problem for REITs, since most of them are finance by debts. MacArthurcook REIT has a gearing of 39%, which is almost the same as AREIT and Cambridge industrial REIT.

More risks than opportunity

Right now, the problem for dividend investors, whether to add or cut or enter new opporunities is which of these stocks have worms in them. My advice is to wait to see next quarters earnings results and commentary to make your decision.

Markets are very oversold, but they can always go lower. Your risk is higher than the reward, so although you think the bottom is here, you might just invest in a can of worms. It might be safer to wait for a week to make your decision

I feel i need to always explain these revised yields so that viewers do not get mislead by extremely good yields.

At current price near 2 dollars the yield i used to put was near 15%. With its stable business, you might think it is a bargain buy.

Hold on there. I have put in the latest 2008 dividend payout which is 6.25 cents. This is a big difference compared to the 30 cts i used to calculate the 15% yield.

As such the current yield turn out to be a miserly 3%.

Hope you guys aren’t affected by the lowered payout. In times like these, you would expect much of this lower revision of yields, but i would try to input as realistic as i can the projected future yields that can be expected.

It started off with a frustration that i had whenever i use my excel sheet to keep track of my dividend stocks and other not-so-good dividend stocks. The frustration was that whenever i see a stock that was sold down pretty badly, i had to find the stock price and key it into my excel sheet, then i need to find the current market cap so that my excel sheet would just compute.

The dividend stock tracker aim to be useful for people that are interested in forming a portfolio of income investments for high yield investing or investment income.

What is the Dividend Stock Tracker

Dividend Stock Tracker tracks a list of dividend stocks that are listed on the SGX. They can be:

• Business Trusts
• REITs
• Utilities and Infrastructure stocks
• Telecommunication stocks
• Blue Chips
• Others

The prices of these stocks will be updated daily at the end of each day. The data will be recomputed and the new ratios and yields will be displayed.

Some of the fundamental data covered are:

• Operating Cashflow
• Dividend Yield
• PE and Earnings Yield
• Operating Cashflow Yield and Free Cashflow Yield
• Price-to-book ratio
• EV/EBITDA
• Return Premium
• Debt/Asset
• % Payout
• % Cash holding of Assets

You may have observed that not all are displayed on the main table, thats because i can’t put everything into a small table.

Clicking on the name of each stock will display more detail information.

Moderating Dividend Payout

You would have notice that some of the yields are quite different from what brokerage houses display. This is because the yields are moderated by me. One time special dividends and dividends that seems unsustainable are moderated downwards so that it doesn’t give people an impression that if you buy now your yield will be that much.

So that is why Courage Marine’s payout is much less than what they paid out last year. I used an average payout for that.

Currency

For Stocks whose balance sheet data are in USD or RMB for example, i will use an exchange conversion. Most of the balance sheet data are thus like what they display in their annual report. E.g. Hongwei’s Total assets in this case is in RMB.

Balance Sheet Data

Balance Sheet Data are updated annually except for assets and debts which are updated quarterly

Conclusion

I hope its useful toďż˝ you as an investor. You can access my dividend stock tracker by clicking on the link next to the home.

You can read more about the metrics that i use in my dividend stock tracker here.

Take a look at the dividend tracker >>

The program is based on MSCI World Data collected. Users can update the data via the data input form by clicking on the View >> Index Data Input.

Setup

Inflation – estimated inflation rate. used to calculate any real values in the program.

Expense Ratio Mth – Expense ratio used for monthly contribution. this is used to calculate the total value for the selected period where the contribution is monthly.

Expense Ratio Yr – Expense ratio used for annual contribution. this is used to calculate the total value for the selected period where the contribution is annual.

Txn Expense Mth – Transaction ratio for monthly contribution. This will be used to calculate the total transaction cost for the selected period where the contribution is monthly.

Txn Expense Yr – Transaction ratio for annual contribution. This will be used to calculate the total transaction cost for the selected period where the contribution is annual.

Monthly Invested Amt – This monthly invested amount will be used to calculate the annual invested amount together with the cash account interest. This is taken with the assumption that the investor does a monthly contribution to his/her portfolio.

Accumulated Sht term interest – This is the cash account interest that the investor can earn for 11 months if he accumulates this in cash rather than invest monthly.

From and To Date – Used this to select the period to investigate. Once calculate is clicked, the values will be calculated and populated. Note that if you select a period that is way out of the data collected, it will only take to the point where there is data collected.

• Performance difference between monthly investment interval vs annual investment interval.
• Can we offset high transaction costs and miscellanous fees to invest in Exchange traded funds because of its low expense ratio compared to majority of the mutual funds in singapore.
• The amount of Transaction and Expense Cost incurred for a given period based on period data.
• Investigate whether there is a certain “tipping point” where expense cost will out weigh transaction cost advantage when comparing investing choices such as Exchange traded funds vs mutual funds.

Completed

• MSCI World Data Input
• Total Value after transaction and expense for a given period
• Nominal and real difference between accummulation using monthly contribution vs annual contribution.

To-Do

• Factor in selling cost
• Factor in 30% withholding tax
• currency conversion cost.