Why has the Soul Patts (ASX:SOL) share price tumbled 16% in a month?

Here’s what the iconic investment house has been up to over the last 30 days…

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The last 30 days have been tough for the Washington H. Soul Pattinson and Co Ltd (ASX: SOL), colloquially known as ‘Soul Patts’, share price.

Despite the investment house completing a significant merger, its stock has tumbled.

At the time of writing, the Soul Patts share price is $33.49, 15.8% lower than it was this time last month.

For context, the S&P/ASX 200 Index (ASX: XJO) has gained 2.1% in the same time.

So, what’s been weighing on the company’s stock lately? Let’s take a look.

The month that’s been for Soul Patts

The Soul Patts share price isn’t performing well this month despite the company finalising its merger with Milton Corporation Ltd.

Market watchers will likely be familiar with Milton Corporation, which used to trade under the ticker MLT. It became a listed investment company (LIC) way back in 1958 when it floated on the Sydney Stock Exchange.

Milton Corporation was delisted earlier this month after Soul Patts took its reins.

The merger was announced in June. It saw Milton shareholders provided with around 0.186 Soul Patts shares for every share in Milton they held. The offer valued Milton’s stock at $6 apiece, representing a 20% premium on its previous closing price.

Unfortunately, the market’s excitement over the merger didn’t last long. The Soul Patts share price gained 1.1% when the merger was completed on 5 October before falling 5.3% the following day.

And that’s not all. Of the last 21 trading sessions prior to today’s, Soul Patts has spent 15 in the red, leading its stock’s value to fall by $6.24.

However, the investment house is confident in its future. Soul Patts released its annual report for 2021 on Tuesday.

While the report isn’t price-sensitive, Soul Patts used the space within it to highlight its previous and expected growth.

Soul Patts share price snapshot

Despite a poor month’s performance, Soul Patts’ stock is well and truly in the green.

Its value has increased 10% since the start of 2021. It is also trading for 33% more than it was this time last year.

Should you invest $1,000 in Soul Patts right now?

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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