Brookfield Preferreds Offer Some High Yield Options

(11min)

Summary

  • Brookfield Corporation's common shares are complex and potentially overvalued.
  • We see the real estate arm as hopelessly over-leveraged and overvalued with a 15X debt to EBITDA ratio.
  • Fitch Ratings affirmed Brookfield's 'A-' ratings still make sense because of the firewalls in place.
  • We look at some preferred shares that we love from the company.
  • Conservative Income Portfolio members get exclusive access to our real-world portfolio. See all our investments here »
A sign at Brookfield Zoo in Brookfield, IL.

Joe Hendrickson/iStock Editorial via Getty Images

All values are in CAD. Prices refer to the TSX-traded stocks and not the OTC ones. This article is written specifically for Canadian investors.

The common stock is a play on the income statement and the bonds are a play

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This article was written by

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Trapping Value is a team of analysts with over 40 years of combined experience generating options income while also focusing on capital preservation. They run the investing group Conservative Income Portfolio in partnership with Preferred Stock Trader. The investing group features two income-generating portfolios and a bond ladder.

Trapping Value provides Covered Calls, and Preferred Stock Trader covers Fixed Income. The Covered Calls Portfolio is designed to provide lower volatility income investing with a focus on capital preservation. The fixed income portfolio focuses on buying securities with high income potential and heavy undervaluation relative to comparatives. Learn more.

Analyst’s Disclosure:I/we have a beneficial long position in the shares of BN.PF.H:CA 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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