Yesterday my resourceful broker from Lim & Tan had invited me to a 2.5 hour workshop organized (packed dinner provided) and hosted none-other by himself. As someone who loves to learn plus with plenty of time to kill on a friday nite I readily agreed. This workshop, he said, is meant for those who were either new to investing or a refresher for experienced investors, with simple calculation for fundamental analysis, a periodic review of STI constituents and value stock screening. I said fine and this is what I've gleaned from the night.
Make full use of SGX Stock Facts for screening
Why waste time studying stocks on physical copy of Straits Times when you've got all the information on SGX portal and more? By using the search criteria in SGX Stock Fact (http://www.sgx.com/wps/portal/sgxweb/home/company_disclosure/stockfacts), you can screen and shortlist a number of high yield stocks in less than 3 minutes. Here's what you can look out for -
How much does the business earns? Price/ earning (PE ratio preferably < 20)
Do I have any dividend? Dividend yield preferably > 3.5%
Is the stock cheap now? Price/ Book Value < 1
Then, use the SGX Company Announcement of individual shares to further filter down to quality, less risky stocks -
Will it go bankrupt? Current ratio > 1 (check balance sheet of latest financial results)
Any liability? Total debt/ Equity < 100 and Interest Coverage > 3
Lastly, verify against the past 5 years earning record on total revenue, gross profit and dividend payout under 'view recent financial data' and see if the stocks are stable/ volatile or increasing/ decreasing.