Brookfield Corp (BN.TO)

Complex business, as are the financials. Today the big fear is over private credit. Stock's back into interesting territory, attractive valuation. So well positioned, whether it's data centres or nuclear. Global footprint, solid reputation, and firepower. Yield is 0.62%.

Likes infrastructure, but buy the parent instead of BIP.UN. It's much more diversified, and you get the benefit of all the segments. On sale, relatively inexpensive compared to some of its subsidiaries.

He still likes it and the private equity business. Also if you add up all the publicly owned companies it has, you get a stock price valued at $65. But it also has a massive real estate portfolio which has done well in the past six months, so you now have a stock worth $90 trading at $60. Has highest quality office buildings, great management, and value.

Among the Brookfields, you want to be as close to Bruce Flatt as possible. And that's BN. Its recovery has outpaced that of some of the US alternative asset managers. If you have a benign view on private credit (which he does), he'd rather own APO than BN today.

Owns the parent company instead of the "children", as he wants dividends flowing up from the subsidiaries as well as fee income from all the funds it manages.

Has owned and traded in the past. Now trading at 22% discount to NAV, historically a good entry point. Q4 was strong, record distribution earnings, hiked dividend. New engines for the business are wealth solutions and insurance segment. One of the best-run alternative managers in the world.

Risk is that its sprawling structure is notoriously hard to value. Interest-rate sensitive. Be cautious. Likely to be a decent long-term hold.

The Brookfield theme is largely about property of one sort or another -- from generating energy to office buildings. 

Big factor in property is interest rates. Concern of higher interest rates in autumn, but he thinks that's unlikely. US is about to have a new Fed chair, with the express view of keeping interest rates lower.

In the property space, he owns GRT.UN.

It's down, because BN's largest business is private credit, which the market is worried over. But he doesn't believe BN being in the same camp as private credit stocks that offer retail redemptions. He liked it in 2023, when it sold off sharply on commercial real estate concerns in the market. He took profits on it last year, but now it's time to look at it. BN is high quality and being unfairly tarred with the same brush.

BAM is a play on lower interest rates, but interest rates are higher now. A play on private credit and private equity, which people are taking a dimmer view on. Probably has the most torque to a reversal in those narratives.

He prefers the parent, BN. Very soberly priced. Very diversified, benefits from the whole Brookfield story. The safer bet, but both good buys here.

Yield on BAM is 3.3%, but stock's very expensive, and is now coming down. BN's yield is 0.5%, so that won't do it for you. BEPC's yield is 3.9% but, again, it's so expensive; even worse, balance sheet has slipped over last 3-4 years.

He doesn't see anything for this investor.

He's very cautious on private equity in general, as well as on private credit. Public companies that invest in the space are all under pressure. He's actually short several of them.

They have a proven track record in asset management, access to liquidity, and can pick up cheap assets in various industries during volatile times. Through their renewables and infrastructure businesses, benefit from the data centre build in the actual build and supplying power.