Investors are always looking for stocks that will appreciate in value or pay out high dividends to reward them for their investments.
Below are three stocks that are expected to do well according to local research houses.
1. Memtech International
Analysts are expecting positive news from the third quarter reports from Memtech, which will likely see an increase in stock price if the company meets expectations.
China’s factories are growing at the fastest pace in five years, increasing their output to meet the high demand and prices offered by the market.
Overall, there is an expansion of China’s manufacturing activity – good news for Memtech.
Furthermore, China has announced a deadline for automakers to stop the sales of fossil fuel-powered vehicle, which will certainly drive up demand for the electric vehicle market.
Analysts think that Memtech will see more opportunities as they are involved in the downstream manufacturing process for electric vehicles.
Besides the increase in activities in China, Memtech’s revenue is also likely to be positively influenced by the launch of Telsa’s new mass-market electric vehicle, model 3.
Currently, Memtech is supplying Telsa with functional plastic components related to the core batteries.
Telsa is aiming to manufacture 20,000 units per month by the end of 2017 and the increase in production will undoubtedly boost Memtech’s results for the year.
Memtech is also partnering with Beats, supplying some parts for the group’s audio devices.
With the sales of wireless Bluetooth headsets expected to grow to 206 million by 2021 (currently supposed to be 150m for 2017), Memtech can expect more business to be brought in from this industry.
Overall Memtech International Limited’s (SGX: BOL) prospects remain positive, and UOB Kay Hian Research has given it a Buy call with an increased target price of $1.33 (previously $1.18).
2. City Developments
City Developments (City Dev) is being seen as a proxy for investors to ride on the upward trend in the residential market in Singapore, especially so as the property market recovers.
Currently, City Dev has announced that they are considering a cash offer to purchase all of the outstanding Millennium & Copthorne Hotels shares.
Analysts have welcomed this decision due to the synergies and value that the takeover could unlock.
It is expected that by gaining full control over M&C and benefiting from the synergies between the two firms, City Dev could increase its revised net asset value by a maximum value of $2.03 per share, assuming 100% stake in M&C.
Such exciting developments are certainly worth monitoring, and DBS Research has given City Developments Limited (SGX: C09) a Buy call with a target price of $12.63.
The company has until 6 November 2017 to make a formal offer to acquire the shares of M&C.
3. Frasers Logistics & Industrial Trust (FLT)
This REIT is favoured by analysts at CIMB Research due to its ability to leverage on Frasers Centrepoint Limited’s Australian development pipeline, and its favourable Australian industrial market.
FLT has an advantage over the other S-REITs which are starting to diversify in Australia as there is a decreasing number of prime assets in Australia left to be acquired.
FLT’s first portfolio acquisition of seven properties has been viewed positively as the properties are expected to strengthen its portfolio.
This is so because the assets are mostly freehold and modern with an average age of 2.4 years.
Furthermore, the acquisition highlights strong sponsor commitment.
Overall, this REIT is deemed to be the best proxy for investors to follow the Australian industrials market and as Australian property market peaks, investors who are invested in FLT will be duly rewarded.
Investors should certainly look out for FLT’s fourth-quarter results on the 2 November 2017.
CIMB Research has increased its target price for Frasers Logistics & Industrial Trust (SGX: BUOU) from $1.10 to $1.20 and project a total return of 17% (upside of 10.3% + yield of 6.7%) for 2018.