WH Soul Pattinson & Co: A ‘structured’ approach to FY24

About the author:

Author name:

By Steven Sassine

Job title:

Associate Analyst

Date posted:

03 October 2023, 7:00 AM

Sectors Covered:

Diversified Financials

• WH Soul Pattinson & Co (ASX:SOL) released its FY23 result which, in our view, was a broadly resilient performance of the investment portfolio, with FY24 arguably set to benefit from a more diversified asset base (e.g. increased Structured yield and PE allocations). Post some listed equity sales the business has ~A$911m of cash and equivalents to take advantage of any potential volatility (both in the listed and unlisted space).
• Key contributions from its core strategic holdings (notably NHC) and the Structured yield portfolio helped grow SOL’s net cash from investments 22% on pcp to ~A$424m. A 51cps fully-franked 2H23 interim dividend was declared (taking total FY23 dividends to 87cps).
• Our DDM/SOTP-derived price target is (login to view). Our changes to forecasts are overleaf. With ~10% TSR upside to our price target, we maintain our Add recommendation.

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