Why Brookfield Business Partners Looks Like a Buy Today

Here’s why I think Brookfield Business Partners (TSX:BBU.UN)(NYSE:BBU) should be on investor watch lists right now.

| More on:

Investors seeking high-quality, long-term investment opportunities today have their hands full. Indeed, the market isn’t providing a lot of great opportunities today.

That said, there are pockets of value. In Canada, one of the best options for long-term investors right now may be Brookfield Business Partners (TSX:BBU.UN)(NYSE:BBU).

Here’s why.

Analysts give Brookfield Business Partners a thumbs-up

Brookfield Business Partners has been hard at work getting deals done at great prices. Indeed, this company has been doing this for some time.

The private equity arm of Brookfield Asset Management, Brookfield Business Partners is in the business of creating value for shareholders. What else could long-term investors want?

The company’s focus has been on acquiring high-quality businesses across the globe with a focus on the bottom line. These companies are ones that many investors may otherwise pass on. Some portion of these businesses needs to be fixed. That’s where Brookfield steps in.

Indeed, the recent deals Brookfield has done have gotten a thumbs-up from analysts. A number of analysts have pointed to Brookfield’s high-quality fundamentals and exposure to high-growth sectors as a reason to own this company.

I tend to agree.

Brookfield’s focus is on providing investors with long-term returns of at least 15%. The company says so on its website. Indeed, I’d like to own more companies that have profit as their primary goal today.

Bottom line

Of all Brookfield companies, Brookfield Business Partners is among the most difficult to value. That’s because this company has a rather large breadth of investments spanning multiple industries.

However, the common tie bringing these investments together is the total-return aspect Brookfield intends to bring to the table. Indeed, the company’s world-class management team is adept at locating opportunities and making even the worst companies outperform expectations over time. For long-term investors, this is a very good thing.

I’m of the belief that private equity investments can be a great part of a well-diversified portfolio. Indeed, these investment opportunities are rarely available to retail investors. Brookfield Business Partners provides a vehicle for the Average Joe to get into this game.

Those seeking excellent long-term returns may want to give this Brookfield subsidiary a closer look. The company’s valuation multiple of around 26 times earnings and long-term historical growth track record speak for itself.

Indeed, private equity investing isn’t for everyone. It requires faith in a management team to do what it says it’s going to do. However, in the case of Brookfield, investors are in good hands.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Brookfield Asset Management. The Motley Fool recommends Brookfield Asset Management Inc. CL.A LV.

More on Investing

A data center engineer works on a laptop at a server farm.
Tech Stocks

3 No-Brainer Data Centre Stocks to Buy With $500 Right Now

Data centres are going to be a huge growth opportunity in the next decade. And these are the top buys.

Read more »

Paper Canadian currency of various denominations
Bank Stocks

1 Magnificent Canadian Dividend Stock Down 28% to Buy and Hold for Decades

This top Canadian dividend stock is underperforming its large peers this year, but a turnaround could be on the horizon.

Read more »

TFSA (Tax-Free Savings Account) on wooden blocks and Canadian one hundred dollar bills.
Dividend Stocks

Where to Invest Your $7,000 TFSA Contribution

The TFSA is attractive for investors who want to generate tax-free passive income.

Read more »

The TFSA is a powerful savings vehicle for Canadians who are saving for retirement.
Dividend Stocks

TFSA Investors: 3 Dividend Stocks Worth Holding Forever

These TSX stocks have the potential to grow their dividends over the next decade, making them top investments for TFSA…

Read more »

hand stacks coins
Investing

Secure a Wealthy Future With These 3 Canadian Stocks

These Canadian stocks have the potential to appreciate substantially over time and may also enhance returns through dividend payments.

Read more »

Tractor spraying a field of wheat
Dividend Stocks

Is Nutrien Stock a Buy for its Dividend Yield?

Nutrien is down more than 50% form the 2022 highs. Is NTR stock now oversold?

Read more »

analyze data
Investing

3 Blue-Chip Stocks Every Canadian Should Own

These blue-chip stocks are backed by large-cap companies with well-established businesses, solid fundamentals, and a growing earnings base.

Read more »

dividends grow over time
Stocks for Beginners

The Smartest Growth Stock to Buy With $2,000 Right Now

Do you have $2,000 to invest for the long term? These three TSX stocks have and will continue to deliver…

Read more »