SL vs Frontier Which Should You Buy?

The debate between investing in developed markets like the United States (SL) and emerging/frontier markets (Frontier) has been a topic of discussion among investors for years. While SL stocks offer stability and a proven track record of growth, Frontier stocks present an opportunity for higher returns and diversification. Both types of stocks have their own set of risks and rewards, making it important for investors to carefully consider their investment objectives and risk tolerance before making a decision.

SL or Frontier?

When comparing SL and Frontier, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between SL and Frontier.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. SL has a dividend yield of 2.88%, while Frontier has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. SL reports a 5-year dividend growth of 17.61% year and a payout ratio of 12.35%. On the other hand, Frontier reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with SL P/E ratio at 3.84 and Frontier's P/E ratio at -257.78. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. SL P/B ratio is 0.66 while Frontier's P/B ratio is 2.82.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, SL has seen a 5-year revenue growth of 1.22%, while Frontier's is 0.62%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with SL's ROE at 17.93% and Frontier's ROE at -1.17%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ₩30850.00 for SL and $6.17 for Frontier. Over the past year, SL's prices ranged from ₩28400.00 to ₩47650.00, with a yearly change of 67.78%. Frontier's prices fluctuated between $2.79 and $8.33, with a yearly change of 198.57%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.