Brookfield Asset Management Voting Ord Shs Class A T.BN.PF.H

Primary Symbol: T.BAM Alternate Symbol(s): T.BN.PF.I | BKFPF | T.BN.PR.X | T.BN.PF.J | BRCFF | BRPSF | T.BN.PR.Z | T.BN.PF.K | T.BN.PF.A | BKFAF | T.BN.PF.L | T.BN.PF.B | BXDIF | T.BN.PR.B | BKAMF | T.BN.PF.C | BAM | BKFDF | T.BN.PF.D | T.BN.PR.K | T.BN.PF.E | BAMGF | T.BN.PR.M | T.BN.PF.F | BAMKF | T.BN.PR.N | T.BN.PF.G | BROXF | T.BN.PR.R | BKFOF | T.BN.PR.T

Financial Services Asset Management

Brookfield Asset Management Ltd. is primarily engaged in providing alternative asset management services. The Company provides its services through an ownership interest in an alternative asset management business, which is carried on by Brookfield Asset Management Inc. (Brookfield) and its subsidiaries. Its products have three categories, which include long-term private funds, perpetual strategies and liquid strategies. The Company's wholly owned subsidiaries include 2451634 Alberta Inc. and Brookfield UK Employee Co Limited. Brookfield is a global alternative asset manager with assets under management across real estate, infrastructure, renewable power and transition, private equity and credit. Brookfield offers a range of alternative investment products to investors around the world, including public and private pension plans, endowments and foundations, sovereign wealth funds, financial institutions, insurance companies and private wealth investors.

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Brookfield Asset Management Voting Ord Shs Class A

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Post by retiredcfon Nov 13, 2020 8:29am

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Post# 31893845

TD Upgrade

Raise their target from US$46 to US$50. GLTA

Brookfield Asset Management Inc.

(BAM-N, BAM.A-T) US$36.01 | C$47.32

Q3/20 Beat; Advancing Next Phase of Growth

Event

BAM reported Q3/20 results and provided a business update.

Impact: POSITIVE

Q3/20 Results: OFFO of $0.53/share was above the consensus estimate of $0.47 and our forecast of $0.50. Fee-related earnings grew 22% y/y to $372mm, and FFO from invested capital rose to $478mm vs. $356mm in Q3/19.
Fee-related Earnings: Strong growth in fee-related earnings should continue, as fee-bearing capital was up $12bln q/q to $290bln, and BAM has a further $30bln of committed capital that will become fee-bearing once it is deployed. BAM has raised $12bln to-date for its latest distressed debt fund, and with the other flagship vehicles now 60% invested/committed, it expects to start fundraising for the successors in early-2021, starting with the next flagship real-estate fund.
Carried Interest: BAM recognized $27mm of net carried interest in Q3/20 and carried interest realization should increase going forward, as the company has restarted certain previously deferred asset-sales processes. With the business environment normalizing, BAM generated $703mm of gross carried interest in Q3/20, and for the first time in two quarters, the gross unrealized carried interest balance was higher sequentially, increasing to $3.5bln vs. $2.9bln in Q2/20.

Next Phase of Growth: BAM is progressing several new strategies, which should become more significant towards the latter half of the decade, including reinsurance. BAM Reinsurance, a Bermuda-based company, has been established to operate the company's small, but growing reinsurance business, and the company intends to distribute a fractional share of BAM Reinsurance to shareholders via a special dividend in H1/21 ($0.33/share). Upon distribution, each whole share of BAM Reinsurance will be structured to be economically equivalent to a BAM share, but eventually BAM Reinsurance could be used to launch a pure-play spin-off of the reinsurance business, once it has sufficient scale.

TD Investment Conclusion

We see a prolonged period of near-zero interest rates as a favourable backdrop for BAM, as it should only increase investor appetite for alternative investment products, and is supportive of real asset values. Furthermore, we anticipate that BAM will tap its near-record liquidity to capitalize on current market dislocation to enhance its franchise, as it has done in previous downturns.