A SUB-HEAD in an article in the current weekly edition of The Edge Singapore said: "Cheap stock, high yield".
The stock referred to is XMH Holdings, whose share price has fallen about 20% since mid-Dec 2015 when it released its 1HFY16 results.
XMH reported a net profit gain of 69.3% to S$3.57 million -- an impressive turnaround but that didn't prevent the stock price from slipping in Jan when bears swarmed all over the market.
The stock has fallen from 13.2 cents in mid-Dec to 10.5 cents last week. It's trading at a PE of just 5.3X based on RHB Research's profit forecast of $8.9 million in the current financial year (earnings per share: 2 cents).
XMH, aside from being described as 'cheap' by The Edge, has a trailing dividend yield of 7.6%, as pointed out by the article.
Given the expected increase in profit in the current FY, it is not unlikely that XMH will at least match its previous FY's dividend.
(The article didn't mention that XMH's net asset value is 14.21 cents a share, quite a bit higher than the stock price of 10.5 cents.)
Stock price 10.5 cents
52-week range 10.5 – 25 cents
PE (ttm) 6.93
Market cap S$48.1 million
Shares issued 458.05 million
Dividend yield 7.6%
Major shareholders:
Elvin Tan Tin Yeow
Credence Capital Fund II
Tan Tum Beng
42.6%
19.9%
8.3%
XMH executive chairman and CEO Alvin Tan was quoted touching on growth plans for a subsidiary, Z-Power Automation, which assembles, retrofits and manufactures marine switchboards, remote control distribution systems and other integrated marine automation products.
He also said that XMH is set to reap operational efficiencies from housing all its three subsidiaries under one roof in the new HQ in Tuas, which was completed in Dec 2015.
The 7-storey HQ will see its first formal investor meeting this Friday (Feb 12) when shareholders vote on a resolution (straight forward) to consolidate every four shares into one.
The EGM starts at 10 am at and the adddress is 55 Tuas Crescent, #07-01, Singapore 638743.
