Essential Insights for Brookfield Investors

Brookfield Stands Out Among Alternative Asset Managers

When evaluating leading players in the alternative asset management industry, Brookfield Corporation emerges as a particularly attractive option for those seeking sustained long-term growth. Alongside prominent competitors like Blackstone and Apollo Global Management, Brookfield has demonstrated robust performance relative to broader market benchmarks. Over the preceding five years, Brookfield Corporation shares have appreciated by an impressive 106.6%, surpassing Blackstone’s 85% gain while trailing Apollo’s 143% rise, yet all have significantly outperformed the S&P 500 during this period. This track record underscores Brookfield’s resilience and potential in a competitive landscape dominated by alternative investments.

Looking forward, several distinctive characteristics position Brookfield to potentially deliver even stronger annualized returns compared to its peers. These factors not only differentiate the company structurally but also enhance its capacity for value creation over extended horizons, making it a noteworthy consideration for discerning investors focused on alternative assets.

The image above illustrates the concept of private equity investments, symbolized by wooden blocks arranged to form the words atop financial charts, highlighting Brookfield’s deep involvement in this space.

1. Brookfield Extends Far Beyond Traditional Asset Management

A core strength of Brookfield Corporation lies in its multifaceted business model, which transcends the conventional boundaries of an asset management firm. The company maintains a significant 73% ownership stake in Brookfield Asset Management, commonly abbreviated as BAM, a standalone publicly traded entity dedicated exclusively to its asset management operations. This structure allows Brookfield to benefit from the fee-generating capabilities of BAM while pursuing additional avenues of growth.

In addition to BAM, Brookfield Corporation holds full ownership of Brookfield Wealth Solutions, a Bermuda-domiciled insurance provider that operates as a publicly listed company under a sophisticated ownership framework. Brookfield Corporation controls 100% of the equity interests, with the outstanding Class A shares designed to be fully convertible into standard Brookfield Corporation shares, providing flexibility and alignment for investors.

Furthermore, Brookfield directly owns 100% of Brookfield Property Group and holds substantial stakes in various publicly traded investment vehicles, all under the management umbrella of BAM. These include key partnerships across diverse sectors, as detailed in the following table:

• Brookfield Infrastructure Partners in the infrastructure sector, with a 26% ownership stake in a $18 billion market cap entity, valuing Brookfield’s position at $4.7 billion.
• Brookfield Renewable Partners focused on renewable energy, where Brookfield owns 46% of a $20.5 billion market cap company, equating to a $9.4 billion stake.
• Brookfield Business Partners in private equity, boasting a 68% ownership in a $3 billion market cap firm, worth $2 billion to Brookfield.

This diversified portfolio of operating subsidiaries and managed entities provides Brookfield with multiple streams of income and growth opportunities, reinforcing its position as a comprehensive investment powerhouse rather than a pure-play asset manager.

2. Brookfield Shares Trade at a Substantial Discount to Intrinsic Value

One of the most compelling aspects for potential investors is the apparent undervaluation of Brookfield Corporation’s stock relative to its embedded asset values. The aggregate market value of its publicly traded investments totals approximately $16.1 billion. When combined with the current valuation of its stake in BAM, estimated at around $62 billion, these holdings amount to roughly $78.1 billion in total, translating to about $34.86 per share. This figure represents approximately 72.6% of the stock’s recent trading price near $48 per share, indicating a meaningful discount.

Beyond these liquid positions, management has conducted a thorough assessment of additional assets. This includes the fair market value of Brookfield Wealth Solutions, its portfolio of private funds and real estate holdings, as well as the net present value of its carried interest in funds managed by BAM. Collectively, these were valued at $98 billion last year, or roughly $43.30 per share when divided by the outstanding common stock shares. Adding this to the publicly traded assets suggests a potential breakup or liquidation value approaching $78 per share.

It is worth noting that realizing the full value, particularly from carried interest, will unfold gradually over multiple years. Nevertheless, the underlying assets are positioned for ongoing compounding growth, driven by strategic capital deployment and operational improvements. Brookfield consistently reinvests the majority of its free cash flow into new investments and acquisitions of operating businesses, a practice that amplifies long-term value creation. With shares trading around $45, the intrinsic value could realistically approach $75 or more in the near term.

3. Leadership Projects Intrinsic Value Reaching $140 Per Share by 2030

Brookfield’s executive team has outlined an ambitious yet grounded projection for the company’s trajectory. Drawing on expected distributable earnings growth averaging 25% annually from the present through 2030, they forecast the intrinsic value per share climbing to $140 by that year. This target represents nearly triple the current market price, offering substantial upside potential for patient investors.

Even accounting for a persistent valuation discount or only partial convergence toward intrinsic value, Brookfield could still generate annualized returns in the 15% to 20% range. This performance aligns closely with the company’s historical results, providing a benchmark for future expectations. While projections inherently carry uncertainty, Brookfield’s strategic positioning across high-growth sectors bolsters confidence in these estimates.

Notably, the company benefits from exposure to transformative megatrends, such as the expansive buildout of artificial intelligence infrastructure, which demands vast investments in data centers, power generation, and related assets—areas where Brookfield has established expertise. Additionally, evolving regulatory frameworks are facilitating greater allocation from retirement vehicles like 401(k) plans directly into alternative assets, further expanding the addressable market for Brookfield’s offerings.

At a time when the stock is experiencing a temporary pullback, these dynamics suggest an opportune moment for investors to begin building positions. The combination of diversified operations, undervalued assets, and promising growth catalysts makes Brookfield Corporation a standout choice in the alternative investment arena, poised for meaningful appreciation over the coming years.