Brookfield Renewable: Exciting Growth Prospects At A Bargain …

Recycle symbol made with dollar banknotes - Ecology and recycling concept

CalypsoArt/iStock via Getty Images

For people who like drama, there is no shortage of it in the market these days, especially with regional banks like First Republic (FRC) see-sawing back and forth every day. There is no doubt that regional banks and perhaps even the banking giants like Bank of America (BAC) and JPMorgan Chase (JPM) are battleground stocks today.

For those who don’t want drama, perhaps it’s a better idea to buy and hold onto dividend stocks that are far-removed from the banking industry, and that are trading in value territory with strong growth prospects.

Such I find the case to be with Brookfield Renewable Corporation (NYSE:BEPC) which unlike Brookfield Renewable Partners (BEP), does not come with the complexity of a Schedule K-1 come tax time. Let’s explore why BEPC offers a good mix of income and capital appreciation potential and current levels.

Why BEPC?

Brookfield Renewable Corporation is a Canadian company that owns and operates a diverse portfolio of renewable energy assets across the world, including hydroelectric, wind, solar, and energy storage facilities.

In recent years, BEPC has significantly expanded its renewable energy portfolio through a combination of organic growth and strategic acquisitions.

The company has a presence in North America, South America, Europe, and Asia.

At present, BEPC has £77 billion in global renewable assets under management. As shown below, BEPC’s assets generate a combined 135,300 MW of renewable energy worldwide.

bepc stock

Investor Presentation

Meanwhile, BEPC has delivered on management’s long-term growth objectives, with accretive FFO per share growth of 8% to £1.56 in 2022. This came from a combination of both organic growth and new strategic projects coming online.

Importantly, BEPC has 19,000 MW of capacity that’s currently under development and / or in advanced stages. This is equivalent to a substantial 14% of BEPC’s current capacity.

Decarbonization by governments around the world is expected to create unparalleled commercial opportunity, with management expecting over £150 trillion in investment capital by all players over the next 3 decades. As such, this undertaking would have to also include nuclear and renewable natural gas, among other clean energy sources, as management highlighted during the recent conference call:

The business is performing well and we are already seeing benefits of the investment beyond our underwriting as nuclear is increasingly recognized as a provider of clean dispatchable baseload power generation.

As an example, the Polish government announced that it has selected Westinghouse’s AP1000 technology for the build-out of the first three of its planned large scale nuclear reactors. This is the key step towards the country achieving its decarbonization targets and greater energy independence. We are also progressing our transition asset investments, including most recently, our investment in California Bioenergy, a leading California based developer, operator and owner of RNG assets, where we have the ability to invest up to £500 million or £100 million net to Brookfield Renewable in downside protected convertible structures that support the development of new agriculture renewable natural gas assets.

This spells opportunity for investors, as management targets 12% to 15% long-term annual total returns, and 5% to 9% annual dividend growth.

This includes the recent 5.5% dividend increase. This represents Brookfield Renewable’s 12th consecutive year of at least 5% dividend increases, and the dividend coverage ratio currently sits at a healthy 116%.

Meanwhile, BEPC maintains a very strong BBB+ rated balance sheet, with £1.1 billion in cash on hand plus receivables, and a safe net debt to TTM EBITDA of 5.3x. It’s also reasonably priced at £33 with a forward P/FFO of 18.6.

This is considering the 12% to 13% annual FFO per share growth that analysts expect this and next year, the strong balance sheet, and management track record.

Analysts have a consensus Buy rating with an average price target of £38.75, which combined with the dividend translates to a potential 21% total return over the next 12 months.

bepc stock

Seeking Alpha

Investor Takeaway

In summary, Brookfield Renewable operates in the attractive renewable energy space, and could deliver double-digit annual returns over the next few years. BEPC has a strong presence in multiple geographies and a diverse portfolio of renewable assets. It also maintains a strong balance sheet with healthy dividend coverage ratios.

Lastly, BEPC stock is reasonably attractive at present for a meaningful starting yield and potentially market-beating returns going forward.

Tags:

debenhams listed on couponmatrix.ukfoodhub listed on couponmatrix.ukhomedics listed on couponmatrix.ukmonki listed on couponmatrix.ukprinterinks-com listed on couponmatrix.ukthe-online-clinic listed on couponmatrix.uk
debenhams listed on couponmatrix.ukThere are few retailers more historic and significant in the UK than the legendary department store Debenhams. With well over 200 years of experience bringing top-quality clothing, drapery and furnishings to British customers, Debenhams has established itself as one of the best-known brands in the country. With a Debenhams discount code from us, you can find whatever clothing you need at bargain prices, from elegant and luxurious dresses and coats to cheap and cheerful swimming costumes, you can enjoy Debenhams’ amazing discounts all year round and feel confident and comfortable wherever you go.
foodhub listed on couponmatrix.ukFind your next foodie fix at FoodHub, the takeaway delivery service with no service fees and delivery from £1 (or even free!). Order from your favourite takeaway restaurants, cafes and dessert parlours, supporting local businesses while keeping the cost low—you can even collect orders or pay in cash if you like. Whether you fancy something greasy or fresh, sweet or savoury, ordering from local restaurants is cheaper than ever with our FoodHub discount codes and offers. We’re always refreshing our page with the latest FoodHub offers, so you can enjoy ordering in guilt-free.
homedics listed on couponmatrix.ukHoMedics is a leading provider of home health and wellness products. The company's mission is to improve people's lives by providing innovative and affordable products that promote health and wellbeing. HoMedics' range of products includes massage chairs, air purifiers, and fitness equipment. With a HoMedics voucher code, you can enjoy discounts on these and other products. So if you're looking for ways to improve your health and wellbeing, be sure to check out HoMedics. At Groupon, we believe that everyone deserves a great deal. That's why we work hard to find the best voucher codes for our customers. We know that saving money is important to you, and we want to help you do just that. With our HoMedics voucher codes, you can save on your next purchase, so why wait? Start browsing today to find your best deal! The HoMedics Shiatsu MAX 2.0 Neck and Shoulder Massager is one of our top-performing products, and it's easy to see why. With its unique design, this massager provides a deep, relaxing massage that is perfect for anyone looking to relieve tension and stress. From massagers to airpurifiers you can find everything you need for the ideal relaxing home. And with our HoMedics discount code or HoMedics voucher code, you can save even more on your purchase!
monki listed on couponmatrix.ukIf you’re looking for a wardrobe overhaul, you’ve come to the right place—Monki is your go-to for trending looks that don't cost the earth. Whether you’re after luxe leisurewear or a glam dress for a special occasion, a Monki discount code from us will cut the cost of your haul! With awesome sustainability credentials and gorgeous collections to choose from, Monki is the perfect combo of casual, cool and chic.
printerinks-com listed on couponmatrix.ukWhether you own a business or work from home, you’ll always need a printer, and a printer always needs ink. Instead of a day browsing for compatible cartridges, turn to Printerinks for a convenient and affordable solution that will have you sorted in minutes. What’s more, a Printerinks discount code will also snag you huge savings on your most coveted cartridges, so you can supply with the minimal amount of cash or time invested.
the-online-clinic listed on couponmatrix.ukWhatever illness or condition you endure, know that there’s near-instant assistance available at The Online Clinic. As an online consultation company, customers across the country can connect with doctors and then leave with a prescription in minutes. From migraines to malaria, a The Online Clinic discount code can help cut costs on medications that treat an array of ailments. So don’t let ill health hamper you another second, turn to The Online Clinic and get the treatment you need. The Online Clinic team are all too aware that medicine – though a necessary expense – can sometimes be a drain on your monthly budget, which is why they provide free next-day delivery on all medications as standard. If it’s your prescription you seek savings on, check out our Groupon page for highlights of any special promotions as well as any voucher codes that could cut the cost the next time you restock. We all known how it feels to hurt, but when pain becomes too intense or prolonged, it may be time to seek help from The Online Clinics pain management service. Whether you struggle with consistent back pain or acute episodes that appear at random, you’ll want a The Online Clinic promo code handy to land quality meds that can put your mind and body at ease without breaking the bank.