Invest In The Future You Want - New Buy

Includes: BEP
by: PassiveCanadianIncome

I'm a huge fan of investing in companies that I continuously do business with. (Products and services that I need in our daily lives) I also believe in investing in the future. It is so obvious that we, as a world population need to start protecting our planet.

Pollution is becoming more and more rampant. Species of animals are getting eliminated constantly. Forests are getting clear cut. Global Warming. Yet we have world leaders still denying the facts... duuuuhhhhh Let's ramp up coal burning… Get the economy going again. It must be so frustrating for scientists, Bill Nye must be pissed.

We can fix it though! There is proof, we can. Remember that massive hole in the ozone layer? It was caused by those aerosol cans and other chemicals aka Ozone depleting substances or ODS. In 1987, the world got together and created an agreement called the Montreal Protocol banning the production of CFCs, halons and other ozone-depleting chemicals.

The ban came into effect in 1989. Ozone levels stabilized by the mid-1990s and began to recover in the 2000s. Recovery is projected to continue over the next century, and the ozone hole is expected to reach pre-1980 levels by around 2075. The Montreal Protocol is considered the most successful international environmental agreement to date. (Source Wikipedia)

So it takes almost 100 years to fix something we did in far less time than that. Luckily, people and companies are stepping up to the plate and starting to fix the problems we create. The Ocean Cleanup Project, Tonnes of Nature Conservatory's, Apple (NASDAQ:AAPL) is investing in that huge Mangrove forest in Colombia. Battery-powered cars and the move to renewable energy to power the planet.

(On a side note - Huge shout-out to Apple for doing that. There is no profit in what they are doing. They are just doing it because it's the right thing to do. It's great to see these massive corporations step up, since the governments don't seem to be)

Back On Track

Alright sorry about that, kinda got a little off track. =)

There is stuff we can do as an individual to better the planet. Pick up litter and watch our carbon footprint etc., etc. But as an investor, I think the easiest thing we can do is invest in clean energy companies. It really is that simple. Warren Buffett, Bill Gates and Jack Ma (some of the richest guys out there) have seen the need to invest in this sector and have invested billions.

Luckily for us, there are quite a bit of renewable energy utilities on the markets these days. Even better they like to reward us with these sweet, sweet dividends.

Even better - One of the world's largest pure play renewable energy companies is headquartered here in Toronto. Canada what! We love ya Brookfield! haha.

Brookfield Renewable Partners

Brookfield Renewable (NYSE:BEP) owns and operates one of the world's largest renewable power portfolios, anchored by 218 hydroelectric facilities. Their portfolio includes 876 renewable power facilities in North America, Latin America, Europe and Asia with a combined installed capacity of 17,400 megawatts.

That is pretty dam impressive! (pun intended) Seriously though, if you're looking for a great place to start investing in renewables, Brookfield maybe for you. The Brookfield group of companies tend to be great investments and generally reward investors with dividend raises yearly.

Personally, Brookfield was one of my first purchases when I started investing a couple of years ago. It has gone up quite a bit for a while but has come back down the last couple of months.

Last week the company posted some mixed results and I think the market overreacted. The stock took a dive!

Brookfield posted a higher net loss per share ending Sept 2018 this year (18 cents per unit) compared to last year (14 cents a unit). But funds from operations went up 18 percent per unit compared to last year.

Their hydroelectric dams underperformed last month, solar was what they were expecting but their earnings from wind power doubled compared to last year. (In large part because of acquisitions.)

Raising Capital

Brookfield expects to complete approximately $1 billion of asset sales and up financing by the end the of the year, which would generate net proceeds of $850 million to BEP. As of the date of this report, we have executed on over $500 million of these initiatives. In total, this will increase our available liquidity to $2.3 billion as we enhance our financial flexibility in the current investment environment. (Source: BEP's 3rd quarter results.)

So they are selling some assets but they are really bringing a lot online as well.

They continued to advance their global development pipeline. A highlight was that we commissioned a 28 megawatt wind farm in Ireland this quarter. The company also progressed an additional 19 megawatts of wind in Scotland, 49 megawatts of small hydro in Brazil, and a 63 megawatt expansion of its pumped storage facility in the U.S. Together these projects are expected to contribute $17 million to FFO on an annualized basis starting in the fourth quarter of 2018.

BEP is also advancing an additional 176 megawatts of advanced stage development through permitting and contracting. The company continued to pursue a tuck-in asset strategy in Europe, closing the acquisition of a 23 megawatt wind farm in Ireland subsequent to quarter-end. (Source: BEP's 3rd quarter 2018 results.)

Brookfield Renewable still targets 5-9% dividend growth per year in the coming years. I think the future looks good!

The Buy

As I stated earlier, Halloween was really scary for Brookfield as their stock was tanking all the way down to a new 52-week low of $34.24 per share. I was watching pretty closely that day and was hoping it would keep falling, but it started to rebound so I placed my order.

We bought an additional 29 shares at $34.76 per share. This represented a yield of 5.63% but they pay their dividend in USD, so after the conversion to Canadian, it's north of 7%. Pretty sweet. Brookfield has rebounded pretty nicely since then as the stock now costs $37.21. Sometimes I can be on the right side of the tracks, haha!

This purchase adds 56.84 USD to our forward dividends and allows us to now DRIP 2 shares per quarter. Unfortunately, Brookfield Renewable doesn't offer a discount on dripped shares like some other companies. Oh, well can't win them all.


Last week I was really debating adding more The Bank of Nova Scotia (NYSE:BNS) or Brookfield Renewable. I wanted to enable the extra DRIP and collect a little extra dividend this year, so I was leaning on Brookfield. This dip was huge and made the decision pretty easy. I'm glad I took advantage of it.

What do you think of my purchase? Does the environmental impact of a company ever affect your decision to invest?

I keep debating adding Suncor (NYSE:SU) to the portfolio, as I deal with them all the time (Petro Canada) but I hate the oil sands environmentally. It's a great dividend stock, but I dunno...