Harrisons - A stable high dividend yield stock

Harrisons - A stable high

dividend yield stock

A good third quarter of 2016 had just gone by like that without us realising time is seriously moving faster than we actually thought so.

Again, this month will be the beginning of the reporting session for most companies to announce their 3rd Quarterly results. But how have the first half session gone for most of the sectors? According to several reports, most didn't do well with a few shining ones.

But one sector that has been doing pretty well is the Trading House Division and the three main players are : DKSH Holdings (M) Bhd, Harrisons Holdings (M) Bhd and Yee Lee Corporation Bhd.

These three companies are agencies that are mainly involved in distribution of products produced by all those multinationals companies in Malaysia and also from other parts of the world.

A good look at these three's companies half yearly reports suggested that they should continue to do well and steady for the rest of the year.

DKSH

The bigger brother of the three, DKSH reported an eps of 7.15 and 12.95 for Qtr 1 and Qtr 2 respectively totalling 20.1 sen. On an annualised basis would give it an eps 40.2 sen which will be significantly higher than 2015's earning of 23.35 sen.

Harrisons

I considered Harrisons as the middle brother compared to DKSH and Yee Lee as the youngest brother. Anyway Harrisons reported an eps of 8.39 and 7.66 for Qtr 1 and Qtr 2 respectively totalling 16.05 sen. On an annualised basis would give it an eps of 32.1 sen which will be significantly higher than 2015's earning of 22.87 sen.

Yee Lee

Yee Lee reported an eps of 6.23 and 5.45 for Qtr 1 and Qtr 2 respectively totalling 11.68 sen. On an annualised basis would give it an eps of 23.36 sen which will be significantly higher than 2015's earning of 17.56 sen.

Yours truly chooses to use the annualised way as a comparison although it remains to be seen how they will fare in the last two quarters. So it is up to you to choose to your own way of comparison if you want to have a good judgement of how they will fare in 2016.

Regular dividends paying stocks

As a matter of fact, I would categorised these three as good defensive stocks that long term investors who have strong holding power could consider adding them to your portfolios. Apart from their rather consistent earnings most of the time (of course there might be exception years of inconsistent expected profits), their share prices also do not swing wildly very often at the slightest of any major crisis happening in the world.

One of the good attractions of these three stocks are their remarkable good records of consistent dividends payments to shareholders over the years. Of the three, I personally feel it is the East Malaysia Kingpins - Harrisons that is the also the King of Dividends Paymaster compared to DKSH and Yee Lee.

Dividends since 2007

Now let us track back to year 2007 until this year for all the three companies' total dividends individually. These figures are obtained from website which should be correct figures. Since 2007, the total dividends from DKSH is RM658.00. Yee Lee's dividends is roughly RM500.00. (But one must take note that Yee Lee gave out a bonus of 2 for 5 in 2010, so by right its dividends should be more than RM340.00 - assuming without the bonus issue).

But take a look at Harrisons' dividends which is a remarkable RM1,795.00! Of course  this included a special bumper dividend of RM500 paid in 2011. Excluding this special dividend, the figure is still RM1,295.00 which is still more than the total combined of its two brothers.

So for good dividends lovers, it is a no brain winner to picking up which trading house shares offers you a higher percentage of dividends payout.

I have been fortunate and lucky enough to be one of the earliest birds to get a good cherry bite on Harrisons shares. Regular readers would remember how I shared on April 11, 2014 : Harrisons - The Kingpin of East Malaysia. It was in that blog that I revealed my 10,000 shares bought in 2004 at RM1.36 were effectively free shares (when one counted the total dividends received since 2004 until 2016). The total amount is RM19,850.00. Minus out my original capital of RM13,500.00 and this would give me a clean clear cut of cash profit of RM6,350.00 in safe pocket plus the current 10,000 free shares worth easily more than RM30,000.00.

Furthermore, on April 4, 2014, I bought another 3,000 shares of Harrisons at RM3.08 and to date, received dividends RM1,350.00 (RM150 dividends per share paid in 2014, 2015 and 2016 x 3,000 shares).

In view of its good dividends history, I have decided to buy more again of Harrisons shares to add into my Kassim's Basket of Defensive Stocks.

Buying 2,000 shares

of Harrisons

on October 4, 2016

at RM3.15

So as of today, my total holdings of Harrisons shares are 15,000. I am not expecting any swift major movements of its share price. In fact, its share price is likely to remain the same for some times to come.

But then again, when its dividends of 15 sen per share (consistently since the last four years) is easily as high as 4.7% high which currently no bank can match, conservative dividends investors should take a look at this stock if it is worth adding to their portfolios.

Yours truly just did.