In the pursuit of dividends, many investors fall into the trap of purchasing stocks purely on a dividend yield basis. Many of these “high-yielding” stocks generated negative TOTAL returns (capital appreciation + dividend returns) over the mid to long term horizon.

In this article, we will be exploring 5 Undervalued Singapore dividend stocks. These stocks need to fulfill the following SIX key criteria: 1) Current dividend yield more than 4%, 2) current market cap more than $200m, 3) Payout ratio less than 70%, 4) 5-years of consistent dividend payments or DPS CAGR more than 20%, 5) low net debt to equity and 6) Low Price to Earnings ratio.

We will be excluding REITs and the Singapore banks on this list. Companies with a high level of customer concentration risk will also be excluded.

Let’s go through each of these six criteria briefly before disclosing our list of 5 Undervalued Singapore