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Brookfield Renewable Partners L.P. (BEP.UN)
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Brookfield Infrastructure Partners L.P. (BIP.UN)
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Brookfield Corporation Class A Limited Voting Shares (BN)
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Brookfield Asset Management Ltd. Class A Limited Voting Shares (BAM)
Q: I currently own full positions in BEP.UN and BIP.UN in a diversified dividend income portfolio. I have considered buying BN as well, but am not sure that increasing my Brookfield concentration is warranted. What are your views?
Thanks.
Thanks.
5i Research Answer:
We like BN, we think BN is trading quite cheap, trading at 11.0x Distributable Earnings while compounding the Distributable Earnings at around 15% going forward. Also, BN’s portfolio is quite diversified including holdings in various businesses such as BEP.UN, BIP.UN, BAM, etc.
Portfolio allocation is a personal decision. For example, investors can have a rule of thumb that a maximum allocation in a portfolio for all the Brookfield entities should be capped at a certain percentage (depending on each person's risk tolerance) to avoid too much concentration. We might use 15% here. But we view BN as attractive enough to buy, certainly, and the stock is acting much better these days.