SGX-listed Keppel Ltd. (SG:BN4) is an attractive stock to consider in 2024 due to its superior dividend yield. Further, analysts are highly optimistic about Keppel stock’s trajectory, with a “Strong Buy” rating and a decent upside for the next twelve months. Remarkably, BN4 stock has already gained 63.1% in the past year.
Keppel is a Singaporean conglomerate involved in multiple industries such as marine, infrastructure, energy, asset management, and urban development. The company recently changed its name from Keppel Corporation Limited to Keppel Ltd.
Keppel paid its most recent dividend of S$0.16 per share on November 7, 2023, representing a yield of 4.67%. Not just that, Keppel also regularly gives out a special dividend, distributed by way of “in-specie” Keppel REIT (KREIT) units.
Factors that Make Keppel an Attractive Stock
Keppel is a well-established, long-standing, blue chip company with a wide moat. Its diversified business line offers protection during turbulent economic times. The company has undergone a drastic transformation in 2023 with the divestment of its offshore and marine business, thus enhancing liquidity. The company is consistently increasing its funds under management and working towards its goal of becoming an asset-light conglomerate. Moreover, Keppel is transitioning toward projects that offer clean energy, decarbonization, environmental solutions, and digital connectivity, all of which are in booming demand.
Meanwhile, Keppel is focusing on becoming one of the largest global asset managers. Working in this direction, Keppel recently announced the acquisition of a 50% stake in Aermont Capital, a Europe-based asset manager for up to S$1.35 billion. Keppel also intends to acquire the remaining stake in Aermont in 2028 for not more than €575 million.
For 2023, Keppel said its total distributions are set to reach S$2.70 per share, reflecting solid total returns to shareholders. In percentage terms, Keppel delivered total returns of 61.1% in 2023, significantly higher than 2022’s total returns of 49.3%.
What is the Price Target for Keppel?
With four unanimous Buys, BN4 stock has a Strong Buy consensus rating on TipRanks. Also, the Keppel Ltd. share price target of S$8.14 implies 14.5% upside potential from current levels.
