Brookfield Asset Management Inc (A)…

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Brookfield Asset Management Inc (A) (BAM.A.TO)

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Curated by Michael O'Reilly since 2020.
1550+ opinions with 4.81 rating (one of the best performing expert).

PAST TOP PICK

(A Top Pick Dec 01/22, Down 20.3%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with BAM.A has triggered its stop loss. To remain disciplined, we recommend covering the position at this time.

HOLD

Hard to keep track of all the Brookfields. Split was to try to create greater transparency and value. BAM is the asset management business. It's the Coco-Cola to Coca-Cola Enterprises. Coco-Cola did better than Enterprises, because it was the brand and held the licenses. Similarly, BAM is not capital intensive. It doesn't own the properties, it only manages them. ROI should be much higher, especially if interest rates keep going up. People are generally betting on this one being the winner.

BUY

BAM and BN Both are good. Solid. Undervalued. Can grow. The reason for the spin-out was to achieve more value and growth. For more torque, though, go with BN-T.

HOLD

BAM vs. BN Really likes Brookfield. His preference is to own the parent company, as it has a unique ability more than the individual silos to allocate capital across the platform. He would continue to hold the asset management spinoff, but may not add.

TOP PICK

Best management in Canada. Likes the upcoming tax-free spinoff, which will unlock its value. BAM will be the ticker for the new asset-light manager of other people's money. Now you won't have to worry about BAM owning real estate. So much room to grow, has assets that everybody wants, like long-life infrastructure that pension funds and insurance companies have to invest in. Yield is 1.28%. (Analysts’ price target is $76.27)

BUY

Still a good stock after their spin-off and recent sell-off. Valuation is still good, though has risen lately. Good to own long-term. If there's a recession in 2023, though, BAM could see a pull back. Short-term upside here, but be cautious in Q1-2023 which he expects to be a weak economy and market. BAM seeks buying opportunities across many sectors, likely in the first half of 2023, when valuations should decline (are high now). They have a ton of cash to buy, but they spend wisely. BAM is in a good spot now.

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Curated by Michael O'Reilly since 2020.
1550+ opinions with 4.81 rating (one of the best performing expert).

TOP PICK

Stockchase Research Editor: Michael O'Reilly BAM manages real assets including renewable power. Recently reported earnings were up 31% and are expected to grow over 17% annually for the next five years. Projected PE is 13x next year's earnings and it is trading under 2x book. Its dividend is backed by a payout ratio under 30% of cash flow and has been growing over the last decade by 8% annually. We recommend placing a stop-loss at $52.00, looking to achieve $63.50 -- upside potential of 35%. Yield 1.25% (Analysts’ price target is $63.40)

BUY

Blue chip. Private equity firm that invests in infrastructure and real estate. Does extremely well. Shares have pulled back, good opportunity to buy. Has confidence in business model and management. Dedicated stewards of capital.

PAST TOP PICK

(A Top Pick Feb 14/22, Down 14%) It was undervalued then and is still undervalued. It executed well in Q3 and models 14% earnings per share growth. Another great Canadian company and good to buy more.

TOP PICK

BAM benefits from being in private markets. Over time, this has done well. Before year-end they will split into Brookfield Corporation and BAM. BAM will remain in name and will invest 3rd-party capital into assets like real estate and infrastructure. This will offer a much smoother stream of capital coming in, because these will consist of fee-related earnings on a recurring basis. BAM has $120 billion of dry powder they can deploy going forward. BAM plans to have $400 billion of capital in 10 years. BAM will likely pay a decent dividend. BN will be the new company and this will be more lumpy. Brookfield is splitting in order to separate the lumpy return stream from the consistent stream. Brookfield has always found cheap, mispriced assets and bought them. (Analysts’ price target is $78.41)

BUY

NAV is between $59-60, so it's trading at a discount. 25% of the company is being spun out. Good growth in gathering and deploying assets. Fees have increased. Good inflation protection on cashflows.

BUY

Management's 5-year forecast projects that if you hold BAM and the upcoming spinoff, stock could have upside of about 30% annualized. BAM itself has generated about 20% annualized return over 20 years. Rising rates have impacted its 60% commercial real estate portfolio. Investment in real assets is an inflationary hedge.

TOP PICK

Serial compounder, secular grower. Pre-eminent alternate asset manager. Real estate, renewable energy, reinsurance, infrastructure, etc. On sale. Yield is 1.32%. (Analysts’ price target is $80.35)

COMMENT

Now more reasonably priced. He prefers pure plays like Brookfield Infrastructure.

SELL

Not a fan. He'd sell. Sees it going to $49, book value. Model price of $49.47, -7% downside. As interest rates go up, and there's a revaluation of assets, asset managers like BAM are going to get hit.

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Brookfield Asset Management Inc (A) (BAM.A.TO)

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