One of the things that separates good investors from the greats is patience. For example, while many investors sitting on considerable gains may consider selling up and buying into a different stock, the likes of Warren Buffett hold for decades in many cases.
In fact, Warren Buffett is rumoured to have said that his favourite holding period is 'forever'. This shows just how long term he is and, by doing so, he is able to allow the companies he holds to fulfil their potential and deliver stunning share price gains.
One stock which could be worth holding for a very long time is Super Retail Group Ltd (ASX: SUL). That's because it is a diversified retail business which is proving to be surprisingly resilient despite the weakness being felt in the economy. For example, Super Retail's shares are up by 5% in the last year (versus a fall in the ASX of 7%) and the company is expected to post a rise in earnings of over 15% per annum during the next two years.
Furthermore, there are rumours that Super Retail may be on the cusp of making a major acquisition so as to take advantage of potentially discounted valuations while the outlook for the wider retail sector remains challenging. This foresight shows that the company is thinking long term and, with it trading on a price to earnings growth (PEG) ratio of just 1.02, it appears to be an excellent long-term buy.
Similarly, buying a slice of Australia and New Zealand Banking Group (ASX: ANZ) may seem rather risky at the present time with regulatory changes requiring additional capital to be held by major banks and the Aussie economy apparently being at risk of falling into recession. However, ANZ offers a yield of 6.8% (fully franked), which is well ahead of the ASX's yield of 4.8%. And, with dividends expected to grow ahead of inflation at 1.9% and being covered 1.4x by profit, ANZ appears to have a very sustainable shareholder payout profile.
In addition, ANZ's price to earnings (P/E) ratio of 10 is below that of the ASX, which has a P/E ratio of 14.8. It is also lower than the banking sector's P/E ratio of 12, which indicates that an upward rerating could lie ahead for ANZ.
Meanwhile, rail freight operator Aurizon Holdings Ltd (ASX: AZJ) is expected to return a greater proportion of capital to its investors under new Chairman Tim Poole. He is also expected to be less inclined to back risky growth projects which, given the outlook for the Aussie economy, appears to be a sound move. And, with the volume of commodities being sold and therefore transported across Australia on the decline, a more cautious strategy is likely to resonate well with the market and help to maintain Aurizon's relatively high P/E ratio of 16.9.
Looking ahead, Aurizon has upbeat growth prospects, with its bottom line due to rise by over 8% per annum during the next two years. And, with a yield of 5.1% (partially franked), its total returns look set to be impressive and could mean that it continues to perform well following the 8% rise in its share price over the last year.
