Goldman Sachs Starts Brookfield Corporation (BN) at Buy

Goldman Sachs analyst Alexander Blostein initiates coverage on Brookfield Corporation (NYSE: BN) with a Buy rating and a price target of $78.00.

The analyst comments: "In our view, BN combines the scale and stability of a global, diversified balance sheet of assets with the expertise from its 73%-ownership in Brookfield Asset Management ("BAM"). The aggregate Brookfield ecosystem oversees nearly $1tr of assets spanning real estate, infrastructure, renewable energy, private equity, private credit, and insurance solutions. We view BN as a capital compounder that is on the cusp of seeing a significant step-up in excess capital generation, resulting in faster book value growth, higher ROE and a greater return of capital (share repurchases) opportunities. This will be supported by (1) Improving cash flow dynamics in the Real Estate business - the biggest source of BN's enterprise value discount; (2) Step-up in Carried interest/ Performance fees; and (3) Steady growth in Insurance amid several business model advantages. Our bottom-up analysis of BN's capital sources and uses suggests that the firm's cumulative net capital generation will step up to an estimated ~$11bn 2025E-2027E up from ~$3bn in 2023-2024, with at least half of this excess capital to go toward share repurchases (~50% of excess, consistent with the pace of deployment towards buybacks in the prior two-year period)."

For an analyst ratings summary and ratings history on Brookfield Corporation click here. For more ratings news on Brookfield Corporation click here.

Shares of Brookfield Corporation closed at $65.72 yesterday.

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