Furore
2022-09-27

$SINGAPORE TECH ENGINEERING LTD(S63.SI)$

For me, I think ST Engineering Limited will be bullish for the longer term outlook. This stock may have been sold down recently on concerns of its high gearing and rising interest rates. However, the stock's fundamentals remain very healthy.

ST Engineering continues to maintain investment grade credit ratings. This implies relatively low funding cost, with net interest cover of 7.4x in FY22F. They have a strong order backlog of $22.2B as on June 2022 and they give a stable dividend payout of around 4.97% at current price of $3.60.

The latest geopolitical developments (e.g., Russia-Ukraine conflict, China and US tensions) have led to a rise in defense budgets in Asia. ST Engineering's Defense and Public Security Segment contributed to 52% of its FY21's revenue; an increase of 8% year on year.

ST Engineering's stock price has currently fallen to support levels at around $3.60. There is a very good likelihood of the current downtrend turning sideways from the $3.60 support level to around $3.8~3.9 plus resistance levels as its 3Q results release in early Nov draws closer. The stock's could go up higher after the 3Q results release.

Can consider buying this stock to keep for a couple of months. It seems to have hit the bottom as of now. I am vested here so my views could be biased, DYODD before making any trading decision.

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Comments

  • Universe宇宙
    2022-09-27
    Universe宇宙
    I like honest people like you especially the part of your last sentence that say 'my views could be biased, DYODD before making any trading decision.' [Like]

    So, take care Tigers, this could be one of the worst dead cat bounce that you can encounter for this stock! [Comfort]

  • Ericdao
    2022-09-28
    Ericdao
    Long term sure la. U can wait? [LOL]
    • EricdaoReplyFurore: 
      [LOL] [LOL] [LOL] [Like] [Like]
    • Furore: 
      Can, why not?
      Started investing in 2007
      Most of the stocks that I bought pre and post the Lehman Brothers incident are still with me after so many years
      Lol
  • winwin123
    2022-09-27
    winwin123
    I don't wish that it happens, but in case there is any tense relationship between countries, this stock will do well right?
    • Furore: 
      With or without tensions, countries will set aside annual budgets for defense
      Sadly to say that with tensions, countries will spend more
      So STE could actually benefit more if there are such tensions
  • hh488
    2022-09-28
    hh488
    I bought high. [Sad]
    • Furore: 
      can always consider doing DCA
  • Trevelyan
    2022-09-27
    Trevelyan
    Wait for Q3, currently an opportunity to buy though!
    • Furore: 
      I feel that there will be a temporary rebound when Q3 results are out
      I'll be holding mine till then
  • dallanube
    2022-09-28
    dallanube
    everything in long term...
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