SOL share price in focus
Founded in 1903, Washington H. Soul Pattinson (WHSP) is an investment company with a diversified portfolio of assets across a range of industries and asset classes.
Some of SOL’s largest holdings include stakes in other well-known publicly listed companies such as TPG Telecom (ASX: TPG), New Hope Group (ASX: NHC) and a cross-shareholding in Brickworks (ASX: BKW).
SOL’s mission is to deliver superior returns to its shareholders by creating capital growth and steadily increasing dividends as a holding company. It’s the second-oldest publicly listed company on the ASX and has a strong track record of capital growth and dividends. In fact, it’s never missed a dividend payment since listing in 1903! It should be thought of as a family-run LIC, for the benefit of all shareholders (who are deeply aligned).
GMG shares
Founded in 1989, Goodman Group is a global integrated property group that owns, develops and manages real estate assets across several continents.
Goodman is the largest ASX-listed property group and operates in markets including Australia, New Zealand, the UK, Japan, the US, and Brazil.
The company is primarily involved with projects such as warehouses, large scale logistics facilities and business and office parks. Its mission is to build mutually beneficial, long-term relationships with its customers and deliver high quality assets.
SOL share price valuation
We would consider SOL to be a ‘mature’ or ‘blue-chip’ business, so some of the metrics that could be worth considering include the debt/equity ratio, average yield, and return on equity, or ROE. These measures give us a sense of the company’s debt levels, their ability to generate returns from their assets, and their ability to consistently return profits to shareholders.
For FY24, Washington H Soul Pattinson & Company Ltd reported a debt/equity ratio of 8.5%, meaning the company has more equity than debt.
Over the last 5 years, SOL has delivered an average dividend yield of 2.4% per year. This is important to note if you’re looking for income from your investments.
Finally, in FY24, SOL reported an ROE of 5.6%. For a mature business you generally want to see an ROE of more than 10%, so SOL’s returns are a bit less than what we’d expect.
In FY24, Goodman Group reported a debt/equity ratio of 21.2%, meaning the company has more equity than debt.
As for dividends, since 2019 GMG has achieved an average dividend yield of 1.3% per year, and in FY24 reported an ROE of 0.1%
It’s important to keep in mind that these are only a small selection of metrics and don’t give us enough information to value the business or make an investment decision. To learn more about valuation, check out one of our free online investing courses.
