We think BEP.UN still deserves an A, given the company’s long runway for growth, decent pricing power, and well-managed history by Brookfield. BEP.UN expects to generate an annualized return (including dividends) for shareholders of around 12%-15% going forward.
We like both names, we think these two are well-managed utility companies with strong operating interest coverage ratio and okay leverage profiles, (5.7x for H and 5.1x for BEP.UN, less than 6.0x is okay for utilities companies), along with track record of raising dividends over the years. All dividend stocks have been hit hard with higher interest rates, but rates will not rise forever, and sentiment could change any time.