Key Morningstar Metrics for Brookfield Asset Management
- : C$70.00Fair Value Estimate
- : ★★★Morningstar Rating
- : NarrowMorningstar Economic Moat Rating
- : HighMorningstar Uncertainty Rating
What We Thought of Brookfield Asset Management’s Earnings
Brookfield Asset Management BAM ended March with USD 614 billion in fee-earning assets, up 1.8% sequentially and 11.8% year over year. Total fee revenue increased 9.7% year over year to USD 1.4 billion in the first quarter, while fee-related earnings increased 10.6% to USD 772 million.
Why it matters: Brookfield continues to generate positive flows, as its mix of alternative products—through its real estate/real assets, private equity, and private credit segments—benefits from ongoing demand for nontraditional products.
- The firm picked up USD 21.1 billion from its fundraising efforts in the first quarter. This was below its quarterly run rate of USD 31.0 billion in the previous eight calendar quarters, with most of the shortfall coming from the credit operations.
- Brookfield deployed USD 19.8 billion of capital during the period, above its quarterly run rate of USD 14.2 billion over the past two years. However, reported realizations of USD 7.8 billion were a step down from USD 9.7 billion in the prior-year period (the firm only recently started reporting quarterly monetization data).
The bottom line: With USD 1.199 trillion in total assets under management, Brookfield remains the second-largest alternative-asset manager in the world behind Blackstone with USD 1.304 trillion. Effective fundraising, deployment, and realization activity has allowed the firm to continue to grow organically, despite the more volatile markets we’ve seen during the past five-plus years.
- As there was little in narrow-moat-rated Brookfield’s first-quarter results that would alter our long-term view of the firm, we expect to leave our fair value estimate in place.
- We continue to recommend that investors look for a 15% discount to our fair value estimate before considering the shares.
