Let’s talk about two companies from Singapore that have outperformed the market in the last year.
Amid the global recessionary fears, Singapore stocks are well-placed, with better dividend yields and stable earnings. The company’s benchmark index, the $Straits Times Index(STI.SI)$, was among the best-performing indices in Asia with a 3.56% return in one year.
This gives an attractive opportunity for investors looking to enter the Singapore market. Leisure company $GENTING SINGAPORE LIMITED(G13.SI)$ and engineering company $SEMBCORP MARINE LTD(S51.SI)$ are our picks for today.
Let’s discuss these stocks in detail.
$GENTING SINGAPORE LIMITED(G13.SI)$
Genting Singapore is among the largest companies in the country. The company has a market capitalization of S$8.6 billion. It is engaged in the construction and management of resorts and casinos.
The stock has a negative beta of 0.72, which means it moves in the opposite direction of the overall market and its volatility is lower than the market. As a result, Genting’s stock hasgenerated a return of 25%in the last year.
The share movements were in sync with itsthird-quarter resultsfor 2022. The company posted its numbers with huge improvements over the previous year, driven by the recovery in the hospitality sector. The net profit after tax for the third quarter was S$135.8 billion, up by more than 100% over 2021’s same quarter. Overall revenue increased by 104% year-over-year to S$519.7 million.
The company is confident about its full-year numbers, as it has yet to see a full recovery in its operations.
Genting Singapore Target Price Forecast
According to TipRanks’ rating consensus, Genting Singapore stock has a Strong Buy rating, based on four Buy recommendations.
The target price of the stock is S$1.06, which has an upside of 10%.
$SEMBCORP MARINE LTD(S51.SI)$
Sembcorp is an integrated company offering engineering solutions to the offshore, marine, and energy industries.
Similar to Genting, Sembcorp also has a negative beta of 0.47. Sembcorp’s stock has beentrading up by a huge 68%in the last year. In November 2022, the stock touched its 52-week high point after it signed a merger deal with Keppel Corporation(SG:BN4)to acquire Keppel O&M.
The company is optimistic about this merger and expects operational and financial synergies. Post-merger, the total order book value for the combined entity will be around S$18 billion. The merger is still due for shareholder approval, but looking at the revised terms, analysts are expecting a go-ahead.
Post the merger talks and revised terms, the stock is on the radar of analysts, and they believe the stock can further ride on such high-order wins.
Is Sembcorp Marine a Good Stock to Buy?
Sembcorp stock has a Moderate Buy rating on TipRanks, with three Buy and one Sell recommendations.
The price forecast is S$0.16, which has an upside of 16.5% on the current price level.
Closing Thoughts
Both Genting Singapore and Sembcorp have an exciting roadmap for 2023, with better travel recovery and the expected merger, respectively.
The analysts’ Buy ratings suggest they will continue to outperform, and the share prices still have the potential for growth.
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