Q: Brookfield Renewable has an A rating and has been one of the most recommended stocks on 5i for income over the years. Since 2021 or so, if you look at the charts, it's been heading south as a trend.
Any opinions on what has changed since 2021 materially that this name seems to have been trending down as oppose to the prior 5 years? Is it because it's not longer a growth name and more a income name? Is it because their earnings haven't been as what they have promised? Just curious to know how or if the narrative has changed?
Any opinions on what has changed since 2021 materially that this name seems to have been trending down as oppose to the prior 5 years? Is it because it's not longer a growth name and more a income name? Is it because their earnings haven't been as what they have promised? Just curious to know how or if the narrative has changed?
5i Research Answer:
BEP.UN had a very strong run prior to 2022 because of huge enthusiasm for all things renewable. It was bid up substantially and then this glow came off. Then, in March 2022 the FED raised interest rates, followed by nine more increases. This (and inflation) hurt about every income stock out there. Earnings releases have also been somewhat inconsistent (missing estimates) for the last two years. Still, not including the BEPC spin off or distributions, the stock has more than doubled since 2016. When interest rates peak we do expect better performance.