Brookfield companies are some of the top choices when it comes to real estate investing. There are plenty of spinoffs to consider, but some of the top choices are Brookfield Asset Management (TSX:BAM) and Brookfield Infrastructure (TSX:BIP.UN).
But which is better?
Today, we’re going to compare the two and see which might be the better buy on the TSX today.
BAM stock
If you’re looking for diversified income, then BAM stock may be your top choice on the TSX today. BAM stock invests in it all. From renewable power to hotels and everything in between, this stock has locations all around the world. It’s created a diversified revenue stream that’s led to stable growth for decades.
However, during downturns, this means the company is seeing less revenue come in from some sectors. Higher costs for renewable energy means less revenue. Lower spending means less cash from its hotel locations and other recreational real estate. So, while there is an upside to diversified income streams, there’s a downside at times as well.
That being said, the company reported during its most recent earnings release that it’s already raised US$100 billion of capital in the last 12 months. Year to release date, it’s raised US$19 billion. It therefore is on the hunt for further acquisitions to continue growth.
Long-term investors may want to look at this as an opportunity to pick up the stock on the TSX today. BAM stock currently trades at just 6.21 times earnings as of writing. It offers a dividend yield at 4.09%, and shares are up 12.5% year to date.
BIP stock
There’s also BIP stock to consider on the TSX today. BIP has a focus on infrastructure, which historically has been a great place for investors looking to protect their cash in a downturn. Infrastructure is necessary no matter what’s going on in the world. And with private and government backing, these are projects that will be built for years to come.
BIP stock also has the benefit of being a global provider of infrastructure, with locations all around the world. It has a larger focus on energy production, but, in the last few years, it has added data infrastructure to its list of offerings.
Even so, costs rising has hurt the stock a bit. The company reported net income of US$23 million for the last earnings report compared to US$70 million the year before. Yet again, it’s been putting capital aside for acquisitions, which helped offset some of the net income through funds from operations growth.
If you’re looking for a deal, however, you’re not going to find it through BIP stock. Everyone has been flocking to the stock, and it’s become quite expensive. Even so, if you’re a long-term investor, it’s worth consideration, especially with a 4.21% dividend yield. That’s despite shares rising 15% year to date.
Yet if I’m choosing one or the other, I’d have to go with BAM stock. The company offers a great deal with exposure to infrastructure, and even more growth coming, as shares look to recover slightly. Plus, it trades at a steal in terms of earnings while also collecting a dividend.
