An expert says Brookfield is "firing on all cylinders" as its asset management arm drives strong returns
Brookfield Corp. continues to benefit from the expansion of its investment subsidiary, Brookfield Asset Management Ltd., as the company strengthens its position through global acquisitions and growth in its credit business, according to BNN Bloomberg.
Christopher Ballard, managing director at Check Capital Management Inc., commented on Brookfield’s performance following its fourth-quarter earnings report.
“They have aspects of infrastructure, renewable energy, real estate, data centres… there’s a lot to look at with Brookfield across the board, but we’re pleased with their numbers,” he told BNN Bloomberg in an interview.
Brookfield reported a net income of US$432m for the quarter ending December 31, translating to a profit of 25 US cents per diluted share.
Although revenue declined compared to the previous year, distributable earnings rose from the last three months of 2023.
Brookfield shares gained approximately two percent in Thursday afternoon trading.
Ballard emphasized that Brookfield’s growth is largely driven by its subsidiaries, particularly Brookfield Asset Management, which has seen its credit division emerge as the corporation’s leading source of expansion.
The publicly traded asset management firm raised US$29bn in the fourth quarter, surpassing estimates, with US$20bn coming from its credit business.
Ballard described the results as “fabulous.”
Among Brookfield’s various subsidiaries, Ballard said the asset management firm generates the highest returns on capital, making its performance highly beneficial to the broader corporation.
He noted that Brookfield Asset Management can strategically time its investments by holding capital before deployment, allowing the parent company to sustain its growth trajectory, which has been increasing at an annualized rate of 15 to 20 percent for some time.
“Brookfield Asset Management now manages more than US$1tn,” Ballard said. “They are a global leader in investment in infrastructure and all different aspects of renewable energy across the world.”
Brookfield is also expanding its role in the global development of artificial intelligence (AI) infrastructure.
Last week, Bloomberg News reported that the company plans to invest more than US$20bn in AI-related infrastructure in France over the next five years.
In addition to expansion efforts, Brookfield is focused on increasing shareholder value.
The company announced an increase in its dividend by one cent to nine US cents per share and has continued its stock buyback program.
“All those aspects are kind of what we’re looking at to make sure that they’re firing on all cylinders, which they really are,” Ballard said.
“You’re going to be hard-pressed to overstate how much of a global leader that Brookfield is across various segments all over the world. They are rapidly growing, and they don’t seem to be stopping anywhere in the near future.”
