DBS Group Research Model Portfolio - Blue Chips
You look to include blue chips into your portfolio to provide steady growth over a longer time period. Blue chips tend to be more stable and their holding period can extend beyond a year.
The Blue Chips category has 6 stocks - Ascendas REIT, Capitaland, City Developments, ST Engineering, Wilmar and SembCorp Industries.
ASCENDAS REIT
- High yields of 7.0% close to -1SD level.
- Strongest earnings growth amongst the large cap REITs.
Company Guide:
CAPITALAND
- Incremental earnings growth momentum from its core residential, retail mall business and Ascott firming up well
- Upside to valuations from potential asset recycling of mature assets into funds/REITs
- Attractive valuations at close to 2009 levels
Company Guide:
CITY DEVELOPMENT
- Incremental earnings growth momentum boosted by asset sales/ stronger operational results from commercial portfolio
- Valuations below historical through level
Company Guide:
ST ENGINEERING
- Steady earnings and dividends provide safe haven in current uncertain and volatile market environment.
- Final dividends to be announced soon. Smart city contracts may be upcoming.
Company Guide:
WILMAR INTERNATIONAL
- Beneficiary of low soybean prices, Indonesia's export tax structure, biodiesel mandate and rising palm oil prices.
Company Guide:
SEMBCORP INDUSTRIES
- Stripping out market capitalisation of SMM and Salalah, utilities business is valued at unjustifiably low valuation of 5x PE and 0.5x PB.
- We also expect the reversal of price trend in the event of elimination of SMM privatisation overhang.
Company Guide:
Singapore Research Team
DBS Vickers
|
http://www.dbsvickers.com/
2016-02-11
