In 2024, I’m looking at the SOL share price

The Washington H Sl Pttnsn nd Cmpny Ltd (ASX:SOL) share price has increased 5.3% since the start of the 2024. It's probably worth asking, 'is the SOL share price priced to perfection?'
The Washington H Sl Pttnsn nd Cmpny Ltd (ASX:SOL) share price has increased 5.3% since the start of the 2024. The BHP Group Ltd (ASX:BHP) share price is 20% off its 52-week low.

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. It should be thought of as family-run LIC, for the benefit of all shareholders (who are deeply aligned).

BHP shares

BHP Group (formerly BHP Billiton) is a diversified natural resources company producing commodities that was founded in 1885.

BHP’s principal business lines are mineral exploration and production. BHP’s assets, operations and interests are separated into three focus areas: Copper and related minerals (e.g. gold, uranium, silver, zinc, etc.), Iron Ore, and Coal (i.e. metallurgical and energy).

BHP shares are often seen as a reliable dividend paying investment and is a common constituent of an ASX share portfolio. If you own an popular ETF or LIC, or invest with Industry Super, chances are you have exposure.

Share price valuation

One way to have a ‘quick read’ of where the SOL share price is, is to study something like dividend yield thru time. Remember, the dividend yield is effectively the ‘cash flow’ to a share holder, but it can be influenced by yearly or bi-yearly fluctuations. Currently, Washington H Sl Pttnsn nd Cmpny Ltd shares have a dividend yield of around 2.71%, which compares to its 5-year average of 2.54%. Put simply, SOL shares are trading below their historical average dividend yield.

Since it is a more mature-style business, the BHP share price is offering a historical dividend yield of around 6.39%, which compares to its 5-year average of 9.38%. The Rask websites, especially our Rask Education platform, offer free tutorials explaining Discounted Cash Flow (DCF) and Dividend Discount Models (DDM). Both of these models would be a better way to value the BHP share price.

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