Brookfield Corp (BN.TO)

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.

Drop due to concerns with big private equity firms declaring force majeure and delaying returning $$ to investors. Solid company, well managed, diversified. You could buy here -- your return will be the dividend, and maybe a bit of capital gain.

Incredibly well run. Thrives in this type of volatility, as they can pick up cheap assets. Lots of capital to put to work. Unique, global. Be aware that it trades at a discount to NAV.

Owns no Brookfield names -- its holding-company ownership structure is rather opaque and old-fashioned. Not enthralled by the pieces.

If he were to own any of the names, it would be BIP.UN.

Huge global investment organization. Not cheap, but in a good position to put $$ to work in this period of disruption. World-class at making investment decisions. Be aware of concerns about AI and credit, as BN has exposure. 

Keep an eye on it. Brookfield can be opaque, we're in a time of volatility, and you know what happens when investors get nervous.

Note:  Owned by his colleague, Christine Poole.

Of the Brookfields, he prefers the parent. Always has. It ultimately controls the subsidiaries and managers hold a lot of shares.

Both are really good choices, but BN is probably the better way to go.

As for BAM, Q3 was intact. Very big infrastructure fundraising for 2026. 24x PE for 16% growth, not bad. Asset managers had a rough time recently. Not first place he'd put new $$ for risk/reward, but a very reasonable hold. Yield just over 4%.

Broad-based, global exposure to a number of different businesses. Reported last night, blew out expectations. Bought back $1B of stock. 

Unique in its ability to take advantage of sizeable secular themes -- electrification, AI, and energy. Excellent capital allocator. Its hard assets are a great way to hedge exposure to inflation and volatility. Yield is 0.59%.

Wonderful question. Brookfield is a big conglomerate, with BN at the top and all the subsidiaries below. Subsidiaries are more income-focused. 

If you're growth focused, and not income-focused, you want to be at the top of the pyramid. BN can optimize value among its pillars. If one subsidiary is richly valued, it can issue shares. If one is trading at a low multiple, it can buy back shares or privatize. You get added levers of value creation at the top of the pyramid.

As good of a long-term compounder as there is. For the younger investor, buy at the right price, and let it work for you.