Brookfield Corp (TSX:BN) has been one of Canada’s top-performing large cap stocks over the past year. Up roughly 100% in a period when the TSX has delivered only modest gains, it has really outperformed.
The question is whether Brookfield can keep all of this going. Stocks tend to come in and out of fashion in a cyclical pattern. When a stock rises a lot in one year, it’s only natural to question whether it can keep up the momentum for another year.
In Brookfield’s case, there is reason to think that the gains can continue. The company continues raising money at a rapid pace, and is signing deals with some of the world’s biggest players in tech, government and real estate. All of these factors bode well for its fortunes in 2025.
If you’ve been following my articles for a while, you’ll know that I’m pretty bullish on BN, having held it since the lows in 2023. Indeed, I have been bullish on BN stock for some time, and I even added to my position recently. In this article, I will explore several reasons why I continue to be optimistic about Brookfield Corp in 2025.
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Dealmaking and fundraising
One of the reasons I’m bullish on Brookfield this year is the fact that the company is doing deals and raising funds at an impressive pace. The company’s asset management subsidiary makes money from investor fees, so the more money that company raises, the greater its fee-related revenue. That in turn spills over to Brookfield’s own earnings.
Some of Brookfield’s M&A achievements in 2024 included:
- $70.4 billion in funds raised across various subsidiaries.
- A deal supplying 10.5 gigawatts of power to Microsoft.
- A new fund with the government of Qatar.
These successes in deal-making and fundraising will drive fee-related income for Brookfield in 2025, meaning the company is likely to grow this year.
Interest rates trending downward
A second reason why I’m bullish on Brookfield this year is because central bank policy rates continue to come down – rapidly in Canada, more slowly in the US. Brookfield is a heavily leveraged company that earns more when interest rates decline. For this reason, it is likely to benefit from the Federal Reserve and Bank of Canada’s recent rate cuts in 2025.
Foolish takeaway
Brookfield Corporation is one of the best-positioned companies in Canada in 2025. From its home base in Toronto, it operates an extremely well-respected financial conglomerate with some of the best assets in real estate, credit, asset management, and more. Indeed, there are few areas of the financial universe that Brookfield does not have a presence in.
Not only that, but Brookfield is very respected. Shortly after he sold the lion’s share of his firm to Brookfield, Howard Marks said that BN was the only buyer he had come across that ticked all the company’s boxes. Those ‘boxes’ included a prestigious name, integrity, and operational excellence. Such high praise coming from someone like Howard Marks is very telling. For this and other reasons, I’ll continue holding Brookfield in 2025 and beyond.
