4 blue chip stocks with a return of 4% or more
As stock prices rise, it becomes more difficult to find dividend paying stocks with reasonable returns.
Investors should be aware of the possible value traps if they encounter dividend yields that sound too good to be true.
On the other hand, companies that shoot all cylinders either pay no dividend or distribute a pittance.
There is also a persistent misconception that small and medium-sized businesses typically pay higher dividends because their stocks stay under the radar.
The truth is, blue-chip billion dollar companies can offer a significant dividend yield as well.
And if you own such stocks for the long term, a steady increase in dividends means you will end up getting a much higher return.
Here are four blue chip stocks with a dividend yield of 4% or more.
Venture Corporation Limited (SGX: V03)
Venture is a global provider of technology products, services and solutions.
The group manages a portfolio of 5,000 products and solutions and has acquired expertise in areas such as life sciences, health and wellness technologies and financial technologies.
Venture has fared well during the pandemic, recording a 4.9% year-over-year increase in revenue for its fiscal first half of 2021 (1H2021).
Net profit increased 7.6% year-on-year to S $ 140.4 million.
The group declared an interim dividend of S $ 0.25, unchanged from a year ago.
Venture’s 12-month rolling dividend of S $ 0.75 gives its shares a rolling yield of approximately 4.2%.
The future looks optimistic for the group as demand remains strong over the next 12 months.
Venture is also poised to support the launch of a new next-generation device platform in the second half of 2021.
Keppel DC REIT (SGX: AJBU)
Keppel DC REIT invests in both data centers and the assets needed to support the digital economy.
The REIT’s portfolio includes 19 data centers in eight countries, valued at approximately S $ 3.1 billion as of June 30, 2021.
In the first half of 2021, gross revenue grew 9% yoy to S $ 135.1 million, while net property income (NPI) grew 8.4% yoy to 123 , S $ 8 million.
Distribution per unit (DPU) jumped 12.5% ââyear on year to reach S $ 0.04924.
At the share price of S $ 2.39, the annualized payout yield (based on the first half of the year) is 4.1%.
Overall leverage remains low at 36.7%, providing sufficient leverage for Keppel DC REIT to undertake further acquisitions.
The REIT had recently announced two acquisitions to strengthen its DPU – the first involved the acquisition of its first data center in Guangdong, China, while the other involved two data center buildings in Eindhoven, Germany.
The demand for data centers is expected to increase with the growth of 5G. Ericsson research projects that 5G will account for 44% of total mobile subscriptions by 2026.
DBS Group (SGX: D05)
DBS Group is one of the three largest banks in Singapore.
The group is present in 18 markets and offers a full range of services in the areas of consumer banking, SMEs and businesses.
The lender posted a set of exceptional results for 1H2021 by posting a record net profit of S $ 3.7 billion.
Fees and assets under management continued to grow 26.2% and 13% year-on-year.
The good news is that the central bank has also lifted dividend restrictions for all local banks, allowing DBS to reset its quarterly dividend to S $ 0.33, from S $ 0.18 a year ago.
CEO Piyush Gupta expects this business momentum to continue and revised full-year loan growth to high, while full-year commission income is expected. increase in the middle of adolescence from year to year.
Frasers Logistics & Commercial Trust (SGX: BUOU)
Frasers Logistics & Commercial Trust, or FLCT, has a portfolio of 103 properties in five countries: Singapore, Australia, Germany, UK and the Netherlands.
Assets under management as of June 30, 2021 were S $ 6.8 billion.
For the first half of 2021 ended March 31, 2021, the REIT recorded a sharp 95.1% year-over-year increase in revenue following its merger with Frasers Commercial Trust.
Adjusted NPI climbed 79.3% year-on-year to S $ 173.9 million. The DPU increased 9.5% year-on-year to S $ 0.038 due to an increase in the number of units issued.
The annualized DPU is S $ 0.076 and the FLCT units offer a forward dividend yield of approximately 5.2%.
The REIT’s occupancy rate remains high at 96.3% as at June 30, 2021, while the overall leverage is 36.4%.
FLCT has a S $ 1.9 billion debt margin and a healthy seven-fold interest coverage ratio, opening up the REIT to more debt-fueled acquisition opportunities to further fuel its DPU’s growth.
Accelerate your retirement plans with these 5 SGX actions. Their dividends are growing and are well positioned to weather storms in the future. We believe that at least one of them deserves a place in your portfolio. To find out their names, pick up a copy of your FREE Special Report: âDividend Stocks That Can Pay You For Lifeâ today. Click here to download now.
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Disclaimer: Royston Yang owns shares of DBS Group, Keppel DC REIT and Frasers Logistics & Commercial Trust.
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