TOL - 17th Feb, 2024
Where Soul Patts is investing for long term growth and dividends
With a market cap over $12 billion Soul Patts is now an ASX50 stock and there’s no signs of a slowdown.
If you're looking for the future blue chips of the ASX, then Washington H Soul Pattinson (ASX: SOL) might be worth a closer look. The company has been around for more than a century and has never missed a dividend payment but, for the most part, has flown under investors' radars.
That is starting to change following the tie-up with Milton Corporation in 2021, which has helped to propel Soul Patts's market cap to over $12 billion and into the S&P/ASX 50. Soul Patts now sits alongside popular names, including Mineral Resources, Car Group, ASX Ltd and Ramsay Healthcare.
Blue chip stocks are known to be large, reliable, profitable and consistent dividend payers. Soul Patts ticks most of these boxes except size, perhaps.
The merger with Milton brought an experienced investment team led by CEO and CIO Brendan O'Dea, 30,000 new shareholders, and a $3.7 billion large-cap portfolio.
O'Dea is now the Chief Investment Officer at Soul Patts and says the merger gives the conglomerate the platform required to build the next generation of investments that will sustain its enviable track record of shareholder returns.
"There's a real desire on our part to seed the strategic assets of the future, and a lot of that is going to come out of that private portfolio," says O'Dea.
In this episode of The Rules of Investing, Brendan O'Dea takes Livewire's James Marlay on a tour of the Soul Patts investment portfolio covering their large cap, emerging and strategic equity portfolios.
O'Dea also shares Soul Patts' unique approach to capital allocation, the asset classes commanding their attention and why you should expect to see more big strategic investments in the years ahead.
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Timestamps
- 0:00 - Introduction
- 1:55 - A global investing experience spanning two decades with CitiGroup
- 4:53 - Milton Corp. and Soul Patts merge creating an ASX 50 stock
- 9:03 - Why Soul Patts reduced exposure in large cap exposure in 2023
- 10:49 - Soul Patts three equity portfolios: Strategic, large cap and emerging
- 15:07 - Waiting for ‘fat pitches’ to put cash to work
- 17:04 - Let the best investments win
- 20:18 - The asset classes attracting capital inside Soul Patts right now
- 24:30 - Resilience in the Australian economy
- 26:02 - Investing in the energy transition and the future of New Hope (ASX:NHC)
- 29:35 - The straight forward thesis for nuclear energy and uranium
- 32:15 - Three regular questions
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The Rules of Investing is one of Australia's top investing podcasts. We interview the leading investment minds from Australia and overseas to better understand their processes and philosophy. After launching in October 2017, there have been over 150 episodes published - you can access all content on Livewire Markets, Spotify and Apple Podcasts.
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The Rules of Investing,
Livewire Markets
The Rules of Investing is one of Australia's top investing podcasts. We interview the leading investment minds from Australia and overseas to better understand their processes and philosophy. After launching in October 2017, there have been over 150 episodes published - you can access all content on Livewire Markets, Spotify and Apple Podcasts.
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Livewire gives readers access to information and educational content provided by financial services professionals and companies ("Livewire Contributors"). Livewire does not operate under an Australian financial services licence and relies on the exemption available under section 911A(2)(eb) of the Corporations Act 2001 (Cth) in respect of any advice given. Any advice on this site is general in nature and does not take into consideration your objectives, financial situation or needs. Before making a decision please consider these and any relevant Product Disclosure Statement. Livewire has commercial relationships with some Livewire Contributors.
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Livewire Markets
The Rules of Investing is one of Australia's top investing podcasts. We interview the leading investment minds from Australia and overseas to better understand their processes and philosophy. After launching in October 2017, there have been over...
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