Brookfield Corp Earnings Grew 20% Plus in Q4

All $ represents USD, unless otherwise specified

Brookfield Corp BN reported Q4 distributable earnings before realization (DE) increased to $1.498 billion, up 24% from $1.21 billion reported last year. The DE per share for the full year 2024 was $3.07, up 15% from $2.66 in 2023. This gives BN a P/DE ratio of only 20, for a business projected to grow 15% annually for the next 5 years.

The total DE after carried interest realization tend to fluctuate significantly, so I decided to value BN stock without considering the carried interest, which is $7 billion after-cost that BN have already accumulated. The CEO has projected the carried interests to grow up to $20 billion in the next 10 years, which is 20% of the current stock market cap. The estimated fair value of the BN stock should be around $67.18 per share, indicating a 12.2% CAGR for the next 5 years. Here are the data used for the DCF calculation:

Latest TTM distributable earnings before realization (DE) of $4.87 Billion
DE growth rate of 15% (5YR AVG 15.8%)
1% share buybacks per year (5YR AVG dilution was 0.94%)
Future Price/DE ratio of 17 (5YR AVG 17.7)
Discount rate of 10%

Here are some highlights for this quarter:

Earnings from the wealth solution business nearly doubled, with $1.35 billion reported for 2024, compared to $0.74 billion for 2023. This is my favorite part of BN and it should be a major growth driver in the next 5 years
Fee earnings grew 17% from the asset management business. Fee earning assets-under-management grew 18% to $539 billion
The real estate business recovered nicely in 2024. Earnings grew 16.6% YoY to $855 million YoY
Increased dividends by 13%, now paying $0.36 per share per year
Repurchased 1.5% of total shares in the last 12 months.

Overall, I think BN stock is still reasonably valued even after the huge rally in 2024. I personally already own BN as a 16% position in my portfolio, so I don't plan to add more unless there is a correction.

You can also see all my past BN stock analysis using this link.

Holdings Disclosure

SoloFIRE BN ownership: 16% of portfolio
SoloFIRE BN Average Cost Paid: CA$44.65
Holding time: 4 years

For on-going changes of my holdings with in-depth analysis, make sure to check out my porfolio updates.

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DISCLAIMER: Solofire is not a registered financial advisor. This post contains author's personal opinion only and it should NOT be considered financial advice.