Strong Performance and Growth Prospects Affirm Buy Rating for Brookfield Renewable Partners L.P.

Analyst Elizabelle Pang from DBS maintained a Buy rating on Brookfield Renewable Partners (BEP – Research Report) and increased the price target to $33.00 from $30.00.

Elizabelle Pang’s rating is based on Brookfield Renewable Partners L.P.’s (BEP) position as one of the largest pure-play renewable energy companies globally, boasting a diverse portfolio and a substantial 20-year track record. BEP’s key business segments contribute a healthy mix to its revenues, with hydroelectric at 50%, wind at 23%, solar at 14%, and energy transition activities at 13%. The company’s impressive capacity of approximately 21,000 megawatts and a development pipeline of around 62,000 MW, alongside its ranking as the world’s sixth leading renewable energy company based on revenue, underscore its market strength. Furthermore, BEP’s financial robustness is evidenced by its deep capital reserves, including US$4 billion in available liquidity and significant partner capital, which supports strategic investments without necessitating equity issuance. This financial foundation has enabled BEP to consistently outperform its peers with an average dividend yield of approximately 6% and a distribution per unit compound annual growth rate (CAGR) of 6%, all backed by an investment-grade balance sheet.

Moreover, BEP’s recent first-quarter financial results for 2024 align with consensus estimates, demonstrating a solid year-over-year growth in funds from operations (FFO) per unit, propelled by strong performance in hydro and storage segments. The management’s affirmation of a 10% FFO per unit year-over-year growth target reflects confidence in the company’s strategic direction. BEP’s long-term goals, including a 10-15% total shareholder return, are further supported by the company’s proactive approach to asset recycling and expected completion of 7GW of new renewable capacity within the year. The combination of ongoing development activities, positive momentum in power contracts, particularly with data-center operators, and potential expansion of key agreements across various regions provide a robust foundation for future growth. These factors, together with the broader industry tailwinds such as increased demand for AI and cloud infrastructure, contribute to Pang’s optimistic outlook and the Buy rating, with a raised target price from USD 30 to USD 33.

Pang covers the Utilities sector, focusing on stocks such as NextEra Energy, Brookfield Renewable Partners, and Atlantica Yield. According to TipRanks, Pang has an average return of 9.7% and a 78.57% success rate on recommended stocks.

In another report released on May 7, Wells Fargo also maintained a Buy rating on the stock with a $32.00 price target.

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Brookfield Renewable Partners (BEP) Company Description:

Brookfield Renewable Partners LP engages in owning a portfolio of renewable power generating facilities primarily in North America, Colombia, Brazil, Europe, India, and China.. It operates through following segments: Hydroelectric; Wind; Solar; Storage and Other; and Corporate. The company was founded on June 27, 2011 and is headquartered in Hamilton, Bermuda.