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  5. BAM: BAM and BN charts are almost the same and over 6 months there is only about a 1% difference in price appreciation, even though PE and dividend yield are very different. [Brookfield Asset Management Ltd. Class A Limited Voting Shares]
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Q: BAM and BN charts are almost the same and over 6 months there is only about a 1% difference in price appreciation, even though PE and dividend yield are very different. Any idea why this is happening and if/when it might change? Thanks
Asked by Martin on March 11, 2024
5i Research Answer:

BN owns 75% of the asset management business which is worth around $50B (US), while its market cap is around $66B (US). Therefore, much of BN’s value came from its stake of BAM. It is not a surprising to see the correlation in performance. That said, over time the return performance will diverge as BN retains and reinvests most of its earnings (which would compound value) while BAM pays out most of its earnings as dividends.

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