15 Singapore-Listed Companies That Are Likely to Withstand the Tough Economic Conditions
369
shares

15 Singapore-Listed Companies That Are Likely to Withstand the Tough Economic Conditions

Sudhan P
369
shares

The coronavirus has battered many economies of the world, including that of Singapore.

Our small economy could see its worst-ever recession if what the authorities have projected comes true.

The Ministry of Trade and Industry expects Singapore’s gross domestic product to shrink between 4% and 7% in 2020, far worst than the 2.2% fall during the Asian financial crisis in 1998.

Amid such tough times, it is important for investors in the stock market to be especially selective when it comes to picking stocks.

Screening for Strong Stocks

With the help of a stock screener, I screened out from the 700-odd Singapore stocks some of the companies with strong balance sheets.

Those companies are more likely to withstand the harsh economic conditions brought about by COVID-19 than those that are bogged down by huge amounts of debt.

I used three broad criteria to filter the universe of Singapore-listed stocks. Those criteria and the reasons I chose them are:

  1. Total revenue (more than S$100 million) — to have companies with a sizeable scale
  2. Return on equity (between 10% and 30%)  — reveals companies with efficient management
  3. Debt-to-equity (between 0% and 20%) — ensures a strong balance sheet

The stock screener revealed more than 20 stocks meeting those three criteria.

From there, I further filtered down the stocks to those that I think are worthy of further research for my own portfolio.

Here, I present to you the 15 stocks from my final list:

CompanyTicker Revenue
(S$' million)
Return on Equity (%)Debt/Equity (%)Price-to-Earnings RatioDividend Yield (%)
SATSS581,979.61913.946.0415.166.25
VICOMV01103.70320.14025.614.68
SIA EngineeringS59994.112.281.2611.475.56
SBS TransitS611445.29715.8615.0511.54.35
RiverstoneAP4324.14617.412.8237.271.14
VentureV033,633.43114.990.0813.034.29
The Hour GlassAGS755.53213.785.295.974.55
CortinaC41502.60118.3317.455.891.56
HRnetGroupCHZ423.08115.5109.955.38
Kimly1D0208.29923.390.0912.345.21
Challenger573329.5718.0909.33.16
UMS558138.17815.2511.8613.393.76
Sheng SiongOV81,068.58226.1114.8227.212.31
ValuetronicsBN2501.42918.6407.155.89
StracoS85108.83513.3213.3711.574.9

(Source: SGX Stock Screener; data as of market close on 3 June 2020)

Further Research Required

As you can see from the list, there are companies that are directly hit by the COVID-19 pandemic, while others like Riverstone and Sheng Siong are thriving in this environment.

A stock screener serves as a useful stock ideas generation tool.

What investors should then do is to dive deeper into the companies sieved out as not all companies may turn out to be great ones for the long-term.

This article is certainly not a recommendation to buy or sell any of the companies mentioned, but to give readers an idea of how to go about finding stocks to invest in.

Have Burning Questions Surrounding The Stock Market?

Why not check out the Seedly Community and participate in the lively discussion regarding stocks!

Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. ​Readers should always do their own due diligence and consider their financial goals before investing in any stock. The writer may have a vested interest in some of the companies mentioned.

About Sudhan P
It isn't fair competition when only one company in the world makes Monopoly. But I love investing in monopolies. Before joining the Seedly hood, I had the chance to co-author a Singapore-themed investment book – "Invest Lah! The Average Joe's Guide To Investing" – and work at The Motley Fool Singapore as an analyst.
You can contribute your thoughts like Sudhan P here.

Still have more questions after reading the article? Fret not, ask our community here!

Stay updated with the latest finance tips!
Receive bite-sized finance on Telegram here.

What's Popular

    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
Comments
369
shares

What's Popular

    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles

Still have more questions after reading the article? Fret not, ask our community here!