ROIC is 7.7%, WACC is 10%. So right now, they're not generating the profitability he likes to see. It will work through over time so that at some point (from 2-5 years), they'll be profitable. Gets you into the private equity world. US deregulation should enhance M&A activity, especially if the Fed cuts another half a point. Good hold for the long term.
Liquidate? He never recommends liquidating. He likes to scale. If you’ve had a good run and there are good profits, and some potential risks to the downside, then you cut a 3rd. If it keeps going up, then you are still playing, and then you cut another 3rd.
Historically, a good company. But BAM has stolen its thunder. There's a question of succession, plus do they have enough capital to build their business? With devalued assets, they should be able to make some money. Relatively undervalued. Not his top pick in the space.
Public version of private equity business model. Subject to volatility as a result of public listing. Would prefer private equity investments in "private" investment vehicle. Higher interest rates will be tough for debt involved in business model.
Under pressure along with all the rest in private equity. Trouble finding liquidity for a lot of their deals. With rising rates, power is now in the hands of the lender, but private equity firms are huge borrowers. Stay away.
Your Watchlist
Add stocks to watchlist to monitor them daily and get important alerts.
ROIC is 7.7%, WACC is 10%. So right now, they're not generating the profitability he likes to see. It will work through over time so that at some point (from 2-5 years), they'll be profitable. Gets you into the private equity world. US deregulation should enhance M&A activity, especially if the Fed cuts another half a point. Good hold for the long term.
He owns BN instead.