Other analysts making changes to Brookfield Asset Management include:
* BMO’s Sohrab Movahedi to US$71 from US$69 with an “outperform” rating.
“Flagship fundraising is progressing well and private market valuations are holding up for ‘stable cash generative assets’, a positive for carried interest realizations,” he said. “Fundamentally, we have argued those drivers of shareholder value should remain intact as long as interest rate increases are cyclical, and not structural. Rightly or wrongly, BAM’s valuation has come under pressure in periods of rising rates. Should the recent decrease to bond yields be sustained, a re-rating would be additive to mid-teens feerelated earnings growth potential; we derive a 35-per-cent total return potential to target.”
* Scotia’s Mario Saric to US$69 from US$68.50 with a “sector outperform” rating.
“We view BAM as a cash generating machine that can work in good times and in bad, with below-average valuation across most metrics,” he said. “We still see 15-per-cent-plus upside from the asset manager spin in (likely) Q4 and remain buyers.”
* KBW’s Robert Lee to US$65 from US$59 with an “outperform” rating.