5 Companies with Dividend Yield above 5% for the Past 3 Years

The dividend yield, which is expressed as a percentage, is a financial ratio that shows how much a company pays out in dividends each year relative to its stock price.

The formula to derive Dividend Yield is as follows:

(Total Dividend Per Share/Average Historical Share Price)

Dividend yield is an estimate of the dividend-only return of stock investment. Assuming the dividend per share remained the same, the yield will rise when the price of the stock falls. And conversely, it will fall when the price of the stock rises.

Given the current low-interest-rate environment, many investors are searching for higher returns. One option for them will be investing in companies that will provide a good dividend yield.

A good dividend yield varies depending on market conditions and the company’s ability to pay dividend. Overall, a dividend yield of above 5% is considered ideal, with the current market conditions.

Hence, here are 5 such Singapore small mid-cap companies :

• CSE Global Limited (SGX: 544)

• Fu Yu Corporation Limited (SGX: F13)

• Maxi-Cash Financial Services Corporation Limited (SGX: 5UF)

• Hotung Investment Holdings Limited (SGX: TY3)

• Hafary Holdings Limited (SGX: 5VS)

Note: Data accurate as of 1 March 2021

1) CSE Global Limited (SGX: 544)

Listed since 1999, CSE Global Limited (“CSE Global”) is a global technologies company with an international presence spanning the Americas, Asia Pacific, Europe, Middle East and Africa. The Group has now more than 1,400 employees worldwide and operates a network of 41 offices across the globe.

For the past 3 financial years, CSE Global’s dividend yield has been above 5%. With the total dividend per share being the same across the years, the declining yield can be explained by the steady increase in its share price.

CSE Global’s share price is last traded at S$0.505, with a market capitalization of S$258.12 million.

2) Fu Yu Corporation Limited (SGX: F13)

Fu Yu Corporation Limited (“Fu Yu”) provides vertically integrated services for the manufacture of precision plastic components and the fabrication of precision moulds and dies.

Since its inception in 1978, the Group has grown to become one of the largest manufacturers of high precision plastic parts and moulds in Asia. Today, the Group has established a strong presence in the region with manufacturing facilities located in Singapore, Malaysia and China.

For the past 3 financial years, Fu Yu’s dividend yield has been above 5%. Like CSE Global, Fu Yu’s total dividend per share has also kept at the same level. This goes to show that Fu Yu’s share price has been on a steady growth, which resulted in the decline of its dividend yield.

Fu Yu’s share price is last traded at S$0.29, with a market capitalization of S$218.36 million.

3) Maxi-Cash Financial Services Corporation Limited (SGX: 5UF)

Maxi-Cash Financial Services Corporation Limited (“Maxi-Cash”) provides financial services in the form of pawnbroking and the retail and trading of good value pre-loved jewellery, timepieces and Citigems, brand new 916/999 Gold. Incorporated in 2008, Maxi-Cash opened its first pawnshop in Ang Mo Kio Central in February 2009, followed by the first-ever pawnshop to begin operations in Orchard Road in August 2009.

For the past 3 financial years, Maxi-Cash's dividend yield has jumped from 6.46% to 19.25% in FY2020. This can be attributed to the sharp rise in the total dividend per share. Furthermore, its share price not being to outpace the rise in dividend payout also contributed to a spike in dividend yield.

Maxi-Cash’s share price is last traded at S$0.182, with a market capitalization of S$188.40 million.

4) Hotung Investment Holdings Limited (SGX: BLS)

Hotung Investment Holdings Limited (“Hotung”) is a venture capital investment management group. The Company has two business segments, namely, Venture Capital and Fund Management. The Group’s fund management business manages third party funds as well as the funds generated from its venture capital business.

For the past 3 financial years, Hotung’s total dividend per share has been on a fluctuating trend. This resulted in its dividend yield displaying a similar trend as its dividend yield has hit a high of 12.17% in FY2020. Therefore, this indicates that its share price and dividend yield are moving in tandem.

Hotung’s share price is last traded at S$1.84, with a market capitalization of S$176.55 million.

5) Hafary Holdings Limited (SGX: 5VS)

Hafary Holdings Limited (“Hafary”) is an investment holding company. The Company supplies tiles, stone, mosaic, wood-flooring, quartz top and sanitary ware and fittings in Singapore. The Company's segments include General and Projects.

Its General segment includes retail walk-in customers purchasing their requirements from the showrooms or customers (such as architecture, interior design and renovation firms) making ad-hoc purchases for home renovation or small property development. Its Project segment includes customers involved in property development projects, whether residential, commercial, public or industrial.

For the past 3 financial years, Hafary’s total dividend per share has been kept at the same level. The decline in its share price resulted in the uptrend of its dividend yield, from FY2018’s figure of 5.9% to 6.9% in FY2020.

Hafary’s share price is last traded at S$0.146, with a market capitalization of S$62.86 million.

Conclusion

To summarize, in a low-interest-rate environment, stocks that are yielding good dividend return will tend to attract investors who have a dividend investment strategy.

Lastly, it is important for investors to keep in mind that higher dividend yields do not always indicate attractive investment opportunities because the dividend yield of a stock may be elevated as a result of a declining stock price.

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