UMS vs CAP Which Is Superior?

UMS vs CAP stocks refer to the comparison between two different investment strategies in the stock market. UMS, or Undervalued, Momentum, and Small-cap stocks, focus on identifying undervalued companies with strong momentum and a small market capitalization. On the other hand, CAP stocks stand for Consistent, Accumulating, and Protected stocks, which prioritize steady growth and protection of capital. Both strategies have their own merits and risks, and investors must carefully consider their financial goals and risk tolerance before choosing between UMS vs CAP stocks.

UMS or CAP?

When comparing UMS and CAP, 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 UMS and CAP.

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. UMS has a dividend yield of 5.4%, while CAP has a dividend yield of -%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. UMS reports a 5-year dividend growth of 14.04% year and a payout ratio of 76.66%. On the other hand, CAP reports a 5-year dividend growth of -1.57% year and a payout ratio of -62.95%.

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 UMS P/E ratio at 14.33 and CAP's P/E ratio at -3.96. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. UMS P/B ratio is 1.73 while CAP's P/B ratio is 0.42.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, UMS has seen a 5-year revenue growth of 1.35%, while CAP's is 0.55%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with UMS's ROE at 12.90% and CAP's ROE at -9.81%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are S$1.00 for UMS and CLP$5302.00 for CAP. Over the past year, UMS's prices ranged from S$0.97 to S$1.58, with a yearly change of 62.89%. CAP's prices fluctuated between CLP$4901.00 and CLP$7750.00, with a yearly change of 58.13%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.