My ASX share for the week is Washington H. Soul Pattinson and Co. Ltd (ASX: SOL).
The share price of Soul Patts is currently down by 21% compared to where it was before the coronavirus smashed the market. Some quality ASX shares have actually completely recovered to where they were before. Soul Patts isn’t there yet.
The investment conglomerate is a regular favourite pick of mine, but it’d be my ASX share pick for the week for two key reasons over the next few days.
TPG Telecom Ltd (ASX: TPM) merger continues
TPG is one of the largest telecommunication companies in Australia and it’s about to get even bigger when it merges with Vodafone Australia. The two telcos have been trying to merge for some time. They were finally victorious in court against the ACCC and are moving forward.
The date has now been set for the shareholder vote to merge the two telcos – 24 June 2020. Not only will the merger bring together two complementary businesses with combined infrastructure, but it will lead to a large special dividend to TPG shareholders such as Soul Patts.
The certainty of the merger going ahead should be a boost for the TPG share price and therefore the Soul Patts portfolio too.
Soul Patts is my ASX share of the week because it has stood the test of time
Soul Patts has been listed on the stock exchange since 1903. Think of all the things it has already survived through. Wars, recessions and other global infections like the Spanish Flu.
I think Soul Patts offers more security than most other businesses and most other types of investments. It’s built to last for decades. That’s why it’s my ASX share for the week and indeed for the decades ahead.
I believe it has a safe balance sheet, with long-term focused investments and a pleasing, growing dividend. I think the Milners and CEO Todd Barlow are very aligned with their share holdings.
As Soul Patts increases its diversification with more investments, such as a planned partnership into regional data centres, it makes me even more confident about Soul Patts’ future.
Foolish takeaway
Soul Patts is my ASX share for the week. I plan to be a very long-term shareholder. The Soul Patts share price looks very good to me today, which is why I’d buy some more this week after the positive TPG news.
Soul Patts isn’t the only share I’d love to buy this week for my portfolio. I’ve also got my eyes on these top ASX shares.
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More reading
- How to retire early using ASX shares
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- My 3 best ASX dividend shares to buy right now
- 2 ASX shares I plan to hold til I’m 100
- 3 Warren Buffett ASX dividend shares to buy right now
Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Washington H. Soul Pattinson and Company Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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