When it comes to investing in ASX dividend stocks, there is one company that I continue to buy hand-over-fist. It's not often we find companies that we would be happy to have dominate our portfolio. But if the share market closed tomorrow and I was forced to own just one company for 10 years, it would certainly be Washington H. Soul Pattinson and Co Ltd (ASX: SOL).
Washington Soul Pattinson or Soul Patts as it's more easily known, is one of the oldest companies in Australia. It first opened its doors in 1903 but has a history that predates Federation.
Soul Patts started out as a chain of pharmacies. But today, it has grown to something quite different. In 2023, this company functions as a collective investment house. It owns large chunks of other ASX shares, as well as a portfolio of unlisted assets, that it manages on behalf of its investors.
So why do I like this company so much?
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Why can't I stop buying this ASX dividend share?
Well, there are a couple of reasons. Firstly, it is inherently diversified. Soul Patts' other investments represent a broad cross-section of the Australian economy. It owns significant chunks of a handful of other ASX shares. These include Brickworks Limited (ASX: BKW), TPG Telecom Ltd (ASX: TPG) and New Hope Corporation Limited (ASX: NHC).
But it doesn't stop there. Soul Patts also owns a huge portfolio of blue chip ASX shares as well, thanks to its acquisition of the listed investment company (LIC) Milton Corporation a few years ago.
But, as mentioned earlier, it also has various unlisted assets too. These include swim schools, citrus farms and industrial property. So an investment in Soul Patts is really an investment in this diversified portfolio of quality assets.
12.3% per annum?
But the primary reason I can never own enough shares of this company is its impressive and unrivalled performance history over an extremely long period of time. Soul Patts only reported its latest earnings last week.
These told us that, as of 31 January, the company has delivered a total shareholder return (share price growth plus dividends) of 12.3% per annum over the past 20 years.
Compare that against the All Ordinaries Accumulation Index's return of 9.3% per annum over the same period, and we can see why this company is a winner. That works out to be a cumulative return of 921% for the 20 years to 31 January, against the All Ords' 498%.
These returns include Soul Patts' famous fully-franked dividends. This company is the only ASX dividend stock on the market that has given investors an annual dividend increase every year since 2000.
So given Soul Patts' inherent diversification, plus its truly outstanding returns over a long period of time, I think this ASX dividend stock is a no-brainer for any investor today. It's why I keep buying, and don't plan on stopping.
