Warren Buffett is one of the most famous investors the world has ever known. He has been an avid investor from a young age, compounding his wealth for decades.
He has shown that it's possible to vastly increase wealth, but surprisingly he only passed $1 billion wealth at the age of 56 and now has around $67 billion today at the age of 86.
It's unlikely he could grow his wealth by the same percentage over the next 30 years, but it's worth listening to some of his wise pieces of advice such as "be fearful when others are greedy and greedy when others are fearful".
Warren Buffett and Charlie Munger's astute stewardship of Berkshire Hathaway has made it one of the biggest and most recognisable companies in the world.
It's worth looking at Berkshire Hathaway's investment style because it has managed to create tremendous value for shareholders.
Berkshire Hathaway's approach is to own large minority stakes in some of the USA's best companies such as Visa, American Express, Wells Fargo and Coca Cola. It also owns some companies outright like Duracell, GEICO and Dairy Queen.
It is possible to own shares in Berkshire Hathaway, but its shares aren't listed on the ASX. However, there is one company on the ASX that has a similar investment style:
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) is a company with a market capitalisation of $3.5 billion that has a diverse array of investments across a range of industries.
It's been listed on the ASX since 1903 and has never failed to pay a dividend throughout this time.
It is similar to Berkshire Hathaway with its large holdings in other listed companies. For example it owns 25.2% of TPG Telecom Ltd (ASX: TPM), 44.1% of Brickworks Limited (ASX: BKW), 24.6% of Australian Pharmaceutical Industries Ltd (ASX: API) and 20.6% of Ruralco Holdings Limited (ASX: RHL).
It also owns some businesses outright such as pipe and plastic manufacturer Cromford Group, as well as corporate advisory Pitt Capital Partners.
This strength of assets has resulted in "Soul Patts" creating a total shareholder return of 89% over the last 10 years. Not many companies on the ASX have this kind of record.
Soul Patts could continue to be a solid stock for investors with its diverse assets, long term focused management and conservative approach.
Time to buy?
Soul Patts is trading at 19x FY17's estimated earnings with a grossed up dividend yield of 4.97% and I think now is a good time to buy shares in the company.
If Warren Buffett were Australian I think he would be proud to be a shareholder of Soul Patts and he may also want to be a shareholder in this stock.
