Quick Update on Q4 2024 Results - Are the Banks Still a Good Investment at All-Time High Prices?

Quote: "There is only one thing you should not waste in life, and that's life itself"

As 2024 comes to a close, I had a peaceful and enjoyable holiday season. For Q4 2024, my dividend income totalled around SGD 18,000, which was a bit disappointing, as it was significantly lower than the SGD 25,000 I received in Q3.

Upon reviewing the figures, this drop is expected, as some of my largest investments are in banks like UOB and OCBC, which only pay dividends semi-annually—in Q2 and Q3. This timing somewhat skews the regularity of my quarterly dividend payments. Ideally, I would prefer a more consistent, quarterly dividend stream to help me manage my funds better when I retire. However, I realize that not all companies offer dividends on a quarterly basis.

Major Contributors to My Q4 2024 Dividends:

• DBS
• AIMS REIT
• Mapletree Logistics
• Frasers Logistics

It’s worth noting that I significantly increased my position in Frasers Logistics in 2024, as their dividends are paid in both Q4 and Q2. This helped offset the absence of dividends from UOB and OCBC during Q4. Meanwhile I have sold all my Wilmar stocks and reduced significantly my holdings in Keppel DC, as I don't see them aligned with my long term objectives.

Looking Ahead: What’s Next?

Planning my next moves is becoming increasingly difficult. At this moment, my "warrior stocks"—a term I use for solid businesses with good dividends—are the Singaporean bank stocks: DBS, UOB, and OCBC. I had a major opportunity to add to these positions in Q3, but I hesitated, waiting for a better entry point at lower prices.

However, as of now, all the bank stocks have seen significant price increases:

• DBS: SGD 44 – 45+
• OCBC: SGD 17+
• UOB: SGD 36 – 37+

These are all-time highs, and purchasing stocks at these levels comes with its own set of risks. It’s a balancing act to decide whether these bank stocks are still a good buy or if there will be a better opportunity in the future.

My instincts tell me that the banks may still be a good investment, as their Q3 results were strong, and Q4 results are expected to be even better, possibly with bonus dividends. If that proves true, the prices may continue to rise. However, this is still speculative, and deciding whether to invest more funds into the banks at their all-time highs will be a challenging decision.

This is my investing journey.