Economists Slash Singapore GDP, CPI Growth Forecasts on Tariffs
Economists have cut growth forecasts for Singapore's gross domestic product and consumer prices as uncertainties of the global trade war leave the Lion City vulnerable to risks.
Singapore's economy is expected to expand only 0.2% year-on-year in the third quarter this year, according to the median prediction of 13 economists in a Bloomberg survey conducted this month. That's a sharp cut from the 1.3% predicted growth in an earlier survey conducted in March.
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Investors Could Be Concerned With DS Sigma Holdings Berhad's (KLSE:DSS) Returns On Capital
What trends should we look for it we want to identify stocks that can multiply in value over the long term? Firstly, we'd want to identify a growing return on capital employed (ROCE) and then alongside that, an ever-increasing base of capital employed. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. However, after briefly looking over the numbers, we don't think DS Sigma Holdings Berhad (KLSE:DSS) has the makings of a multi-bagger going forward, but let's have a look at why that may be. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. For those that aren't sure what ROCE is, it measures the amount of pre-tax profits a company can generate from the capital employed in its business. The formula for this calculation on DS Sigma Holdings Berhad is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.093 = RM11m ÷ (RM135m - RM15m) (Based on the trailing twelve months to March 2025). So, DS Sigma Holdings Berhad has an ROCE of 9.3%. On its own that's a low return, but compared to the average of 7.3% generated by the Packaging industry, it's much better. View our latest analysis for DS Sigma Holdings Berhad Historical performance is a great place to start when researching a stock so above you can see the gauge for DS Sigma Holdings Berhad's ROCE against it's prior returns. If you're interested in investigating DS Sigma Holdings Berhad's past further, check out this free graph covering DS Sigma Holdings Berhad's past earnings, revenue and cash flow. In terms of DS Sigma Holdings Berhad's historical ROCE movements, the trend isn't fantastic. Over the last five years, returns on capital have decreased to 9.3% from 45% five years ago. Meanwhile, the business is utilizing more capital but this hasn't moved the needle much in terms of sales in the past 12 months, so this could reflect longer term investments. It's worth keeping an eye on the company's earnings from here on to see if these investments do end up contributing to the bottom line. On a related note, DS Sigma Holdings Berhad has decreased its current liabilities to 11% of total assets. That could partly explain why the ROCE has dropped. Effectively this means their suppliers or short-term creditors are funding less of the business, which reduces some elements of risk. Since the business is basically funding more of its operations with it's own money, you could argue this has made the business less efficient at generating ROCE. In summary, DS Sigma Holdings Berhad is reinvesting funds back into the business for growth but unfortunately it looks like sales haven't increased much just yet. And investors appear hesitant that the trends will pick up because the stock has fallen 37% in the last year. Therefore based on the analysis done in this article, we don't think DS Sigma Holdings Berhad has the makings of a multi-bagger. If you want to know some of the risks facing DS Sigma Holdings Berhad we've found 2 warning signs (1 is significant!) that you should be aware of before investing here. While DS Sigma Holdings Berhad isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets. — Investing narratives with Fair Values Vita Life Sciences Set for a 12.72% Revenue Growth While Tackling Operational Challenges By Robbo – Community Contributor Fair Value Estimated: A$2.42 · 0.1% Overvalued Vossloh rides a €500 billion wave to boost growth and earnings in the next decade By Chris1 – Community Contributor Fair Value Estimated: €78.41 · 0.1% Overvalued Intuitive Surgical Will Transform Healthcare with 12% Revenue Growth By Unike – Community Contributor Fair Value Estimated: $325.55 · 0.6% Undervalued View more featured narratives — Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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A Look At The Fair Value Of P.A. Resources Berhad (KLSE:PA)
Using the Dividend Discount Model, P.A. Resources Berhad fair value estimate is RM0.18 Current share price of RM0.18 suggests P.A. Resources Berhad is potentially trading close to its fair value Industry average of 78% suggests P.A. Resources Berhad's peers are currently trading at a higher premium to fair value Today we'll do a simple run through of a valuation method used to estimate the attractiveness of P.A. Resources Berhad (KLSE:PA) as an investment opportunity by taking the forecast future cash flows of the company and discounting them back to today's value. We will take advantage of the Discounted Cash Flow (DCF) model for this purpose. Before you think you won't be able to understand it, just read on! It's actually much less complex than you'd imagine. Remember though, that there are many ways to estimate a company's value, and a DCF is just one method. Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. As P.A. Resources Berhad operates in the metals and mining sector, we need to calculate the intrinsic value slightly differently. Instead of using free cash flows, which are hard to estimate and often not reported by analysts in this industry, dividends per share (DPS) payments are used. Unless a company pays out the majority of its FCF as a dividend, this method will typically underestimate the value of the stock. The 'Gordon Growth Model' is used, which simply assumes that dividend payments will continue to increase at a sustainable growth rate forever. For a number of reasons a very conservative growth rate is used that cannot exceed that of a company's Gross Domestic Product (GDP). In this case we used the 5-year average of the 10-year government bond yield (3.6%). The expected dividend per share is then discounted to today's value at a cost of equity of 9.3%. Relative to the current share price of RM0.2, the company appears around fair value at the time of writing. Remember though, that this is just an approximate valuation, and like any complex formula - garbage in, garbage out. Value Per Share = Expected Dividend Per Share / (Discount Rate - Perpetual Growth Rate) = RM0.01 / (9.3% – 3.6%) = RM0.2 Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. If you don't agree with these result, have a go at the calculation yourself and play with the assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at P.A. Resources Berhad as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 9.3%, which is based on a levered beta of 0.956. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Check out our latest analysis for P.A. Resources Berhad Strength Debt is well covered by earnings. Weakness Earnings declined over the past year. Dividend is low compared to the top 25% of dividend payers in the Metals and Mining market. Current share price is above our estimate of fair value. Opportunity PA's financial characteristics indicate limited near-term opportunities for shareholders. Lack of analyst coverage makes it difficult to determine PA's earnings prospects. Threat Debt is not well covered by operating cash flow. Paying a dividend but company has no free cash flows. Although the valuation of a company is important, it is only one of many factors that you need to assess for a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. For P.A. Resources Berhad, we've compiled three important aspects you should consider: Risks: We feel that you should assess the 2 warning signs for P.A. Resources Berhad we've flagged before making an investment in the company. Other Solid Businesses: Low debt, high returns on equity and good past performance are fundamental to a strong business. Why not explore our interactive list of stocks with solid business fundamentals to see if there are other companies you may not have considered! Other Top Analyst Picks: Interested to see what the analysts are thinking? Take a look at our interactive list of analysts' top stock picks to find out what they feel might have an attractive future outlook! PS. Simply Wall St updates its DCF calculation for every Malaysian stock every day, so if you want to find the intrinsic value of any other stock just search here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
