Should You Buy Brookfield Asset Management While It's Below $55?

Matt DiLallo, The Motley Fool

Sat, Apr 26, 2025, 3:41 PM 4 min read

Like many stocks, Brookfield Asset Management (NYSE: BAM) has slumped this year. Shares of the leading global alternative asset manager were recently below $55 a piece, down more than 15% from their high earlier this year.

Here's a look at whether the dip is a buying opportunity or if investors should wait for the stock to fall even further.

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Brookfield Asset Management is coming off an excellent year. It generated nearly $2.5 billion in fee-related earnings last year, a more than 10% increase from 2023. Its growth rate accelerated during the year as the company raised capital from investors and deployed it into fee-bearing investments. Brookfield raised $135 billion from investors last year, including a record $29 billion in the fourth quarter. That helped drive an 18% increase in fee-bearing capital during the fourth quarter and a 17% uptick in fee-related earnings in that period.

That gave it a lot of momentum heading into 2025. President Connor Teskey stated in the fourth-quarter earnings press release that "2025 is shaping up to be yet another record year for us." Brookfield has continued to grow its investment platforms this year. It recently closed its inaugural infrastructure structured solutions fund, achieving its $1 billion target. The company also entered into a strategic partnership with Angel Oak, acquiring a majority stake in that business to expand its credit business.

These and other growth drivers enabled Brookfield to hike its dividend by 15%. With its share price falling and dividend payment rising, it has a dividend yield of nearly 3.5% at the current sub-$55 share price. That's more than double the S&P 500's dividend yield (less than 1.5%).

Brookfield's progress over the past year has put it in a strong position to continue growing briskly. The company ended last year with $539 billion of fee-bearing capital. It plans to increase its fee-bearing assets under management (AUM) to around $1.1 trillion by 2029 as it expands its various investment platforms.

That growing fee-bearing capital will increase the company's fee-related income and distributable earnings. Brookfield sees its fee-related earnings rising at a 17% compound annual rate through the end of the decade, more than doubling the total to $5 billion. Meanwhile, it expects distributable earnings (DE) to grow at an 18% compound annual rate, increasing from almost $2.4 billion last year to $5.1 billion in 2029. It plans to pay most of its distributable earnings to investors in dividends (95% payout ratio).