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Brookfield Renewable: A Green Energy Giant With A 4.3% Yield

Pacifica Yield profile picture
Pacifica Yield


  • Brookfield Renewable is up 22% year-to-date, breaking with the broader market downtrend to outperform its peers.
  • The renewable energy giant currently offers a 4.3% distribution rate to its unitholders.
  • Its development pipeline now stands at approximately 126,000 MW against a target to grow the distribution by 5% to 9% annually.

Solar panel and wind turbine farm clean energy.

Blue Planet Studio/iStock via Getty Images

Brookfield Renewable (NYSE:BEP) (NYSE:BEPC) is having a great 2023, its commons are up 22% since the start of the year and it recently reported dual beats on its fiscal 2023 first-quarter earnings. The

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Pacifica Yield profile picture
The equity market is an incredibly powerful mechanism as daily fluctuations in price get aggregated to incredible wealth creation or destruction over the long term. Pacifica Yield aims to pursue long-term wealth creation with a focus on undervalued yet high-growth companies, high-dividend tickers, and green energy firms. By Leo Imasuen

Analyst’s Disclosure: I/we have a beneficial long position in the shares of CWEN.A, AY either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (20)

They overpaid the business unit for Westinghouse. BEP should bought think Westinghouse originally! I suspect inter corporate sales.
Thank you for this excellent article. Do you have any feedback about the preferreds on the TSX exchange, BRENF? Are they similar to the BEP.PA on the NYSE?
Investing rookie here. I'm totally blown away by some of the payout ratios I've seen. Some in normal range, and others at over 6000%. I need to understand this. Could Brookfield's current cash flow, and with their new expansion in Australia, outweigh the negatives of their extreme payout ratio?
D.S. Leach & C.E. Leach profile picture

You need to read up on the difference between C-corp financial metrics, where EPS and Payout Ratio are typically meaningful, versus MLPs where EPS and Payout Ratios are typically meaningless. BEP is an MLP.

Hint: Plant and equipment depreciation play an very outsized role in MLP financial reporting making EPS and EPS/Dividend poor metrics for evaluating health of the MLP.

@MatiasNeedsMoney For companies like this, as well as REITs and other MLPs, you need to look at FFO instead of EPS as depreciation majorly impacts EPS to the downside.
Brookfield is reminding me more and of GE when they went Finance...they seemingly could always materialize EPS and know really understood their financial structure.

Hence, I'm trying to unwind my BAM and BEP positions.
LifelongMetsfan1 profile picture
@cpr1200r100 when you type “unwind” are you saying you are selling shares?
Dividending profile picture
Own BEPC (Canada) shares while expecting excellent growth and compounding with a long runway.
You should mention the corporate bonds, BEPI and BEPH which are higher up in the capital ladder than the preferred shares and offer higher yields.

Also, the parent company has corporate bonds BNJ and BNH which are one notch higher in credit quality and offer similar yields.

Why buy a preferred share that can suspend it's dividend when you can get a bond that won't unless they default. And you get a higher yield on the bond!
D.S. Leach & C.E. Leach profile picture

Like BEPI and BEPH, BNJ is perpetual and payments are qualified (vs ordinary income) and are eligible for the lower 15% tax rate. BNH has a 2080 maturity date and payments are qualified (not eligible for the 15% tax rate).

@D.S. Leach & C.E. Leach A maturity date is a positive when you are buying shares at such a discount to the redeemable price.
D.S. Leach & C.E. Leach profile picture

Not when that maturity date is 2080 unless you are leaving those bonds to your grandchildren.
D.S. Leach & C.E. Leach profile picture
I chose to invest in their perpetual baby bonds BEPI and BEPH when they were beaten down and yielding north of 8%. Very unique subordinated notes.
No maturity date (perpetual).
Interest payments qualify for the 15% tax rate.

Check the link below as well as the prospectus.


@D.S. Leach & C.E. Leach

Thank you.
gastro4 profile picture
@D.S. Leach & C.E. Leach thoughts on BIPI and BIPH?
D.S. Leach & C.E. Leach profile picture

I view BIPI and BIPH similar in credit quality to BEIP and BEPH. I would note that BIPI is a perpetual subordinated note with payments eligible for the lower 15% tax rate. BIPH is not perpetual and has a 2081 maturity (still a very long duration). BIPH payments are NOT eligible for the 15% rate.

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