Investment Q&A

Q: Hi. I am trying to figure out how meaningful reported FFO numbers are for a company like Brookfield Renewable. When Brookfield invests in a solar panel project there is a large upfront cost that produces cash flow for a fixed period of time. If the solar panel project has a lifespan of 30 years, the FFO numbers would presumably be similar in year 1 versus year 29. However, the value of the asset would be much lower in year 29 than year 1. When looking at cash flow for a company like Brookfield how do you account for the finite lifespan of some of their investments?

Q: Good morning
What is the difference between these two and which is more tax efficient in a non registered account? Are the dividends basically as safe in either ?
Thanks
Jeff

Q: Is Alberta's ban on renewables positive for cpx or negligible.

How about bepc. Thank you

https://www.reuters.com/sustainability/albertas-ban-renewables-could-hurt-c11-bln-investments-says-study-2024-03-11/?utm_source=Sailthru&utm_medium=Newsletter&utm_campaign=Power-Up&utm_term=031124&user_email=9deb120111f07c11d764a45bf582a9efe81c145ce56a1f84d95636385fb0a27b

Q: Hi
Accumulated these utilities as part of my non-correlated asset mix. BEPC has been the worst performer. Down 16%. Hydro One is the best performer so far. Up 6%. EMA/FTS are nearly neutral.
I followed your pragmatic and practical suggestions and took only a partial position in each of these stocks.

Time to add ? In what order would you add? My plan is to add equal amounts.
Many thanks.

Q: Please rate each one for growth potential (1=poor, 10=good) over the next year and why for each

Q: BEPC has only gone down long term, including recently during a rising market. Yet analyst targets and fair value assessments range from $39-$46. The yield is approaching 6% and I would expect it to provide a floor for the stock soon. How safe is the dividend? Would you be averaging down at these levels if you had taken a small position at higher (mid-$40’s) levels?

Q: Which one is a better buy today ? Thanks a lot.

Q: I just bought BEP.UN in a non-registered account,shall the dividends be " fully taxed" ( equivalent to interest), if not how precisely will they be taxed ? Should I then switch for BEPC ? Thanks..

Q: Hi,

Thank you for answering Scott's question today (Jan 30, 2024) and choosing BIPC. His question didn't include all the components of BN behemoth. I know your favorite is BN for growth and BAM for dividends. Can you rank order others, especially BEPC/BIP? To one of earlier questions about energy stocks you chose BEPC. I understand the rationale there. If you were to ignore the energy sector where would BEPC stand?
Many thanks.

Q: 9:51 AM 1/20/2024
Does the US newly instituted tax rule on limited partnerships doing any business in the US now apply to BEP.UN, BIP.UN. BEPC, BIPC?
I have owned these for many years and all have very large capital gains in cash accounts so I am reluctant to sell them due to the crippling 10% 'disposition' tax on top of the big capital gain were I to sell. It seems I am caught in a tax trap! I would appreciate any advice on which ones are vulnerable to the tax and what to do.
Regards............ Paul W. K.

Q: Hi 5i,

I would like to sell BEPC to benefit from tax loss and buy back in 31 days.

Portfolio includes:
2.5% Fortis
2.5% BEPC
1% PIF

Also have :
2.5% BIP.UN
1% BAM
2% BN

I am retired, like dividends and some growth.

1. Looking for a proxy for BEPC for one month
2. Your suggested mix of Utilities.

( Will probably increase BAM some more.)

3. PIF - I like the dividend but volatile for a utility and hasn't gained SP for many years. I have a small loss. Is the dividend secure? Any reasonable gain anticipated over next year or two for PIF?
Might gains be a little more outsized due to interest rate reductions in next year or so?
Do you think it could be a takeover candidate?
Should I hold this or sell?

Thank you for your usual great advice.
I prefer more rather than less detail. (Subtract as many credits as needed.)

Q: BEPC seems to have a dividend history of about 3 years so i find it hard to know circumstances under which they'd lower it but i assume it could include climate related factors. BAM on the other hand looks to have reduced (or adjusted due to a spinoff or restructuring, etc) their dividend in 2007, 2014, 2015 and 2020. Then in 2023, it increased by 128%. As the Brookfield name seems to have a lot of cash, it appears that it might be hard to predict when the BEPC dividend could be cut. Would you please guide on how to assess the sustainability of dividend payments for BEPC? Do you think there is much risk of the present dividend being cut? Thanks for your usual market wisdom.

Q: More questions on BEPC
When it launched, it grew rapidly from 07/2020 to 01/2021, then it began a steady decline which seems to have abated in 09/2023. Are there specific reasons that you know of for its 6 month climb and the following 31 month decline? And do you know of the reason(s) for its gradual climb from 09/2023 to today, which looks like the second longest climb since it was launched? I would think there’d be a story but maybe its only known to BAM. I read once in the G&M that one of the downsides of owning Brookfield companies was the complexity of ownership and the difficulty sometimes in understanding the attribution of consequences among the firms.
On 5 Dec/23 you were asked for your top 3 utility pics and replied with FTS, BEPC, H. Would the 3 be the same today and would the order be different?
Many thanks and please serve yourself and the credits -- i don't seem to use them up fast enough !

Q: Hi 5i,
In a RRSP account, is it better to have BEP.UN:CA or BEPC:CA?
Thanks.

Q: Do you think renewables are a good buy currently?

Do you like NPI or do you have another recommendation?

Q: What would your top three utility picks be today for income and some capital appreciation?

Q: I hold both BEPC and BEP.UN. THE BEPC SHARES I HOLD AT A LOSS. I’M WONDERING IF YOU KNOW WHETHER OR NOT I CAN SELL THE SHARES IN BEPC AND BUY BEP.UN WITH The proceeds, and still claim the capital loss on the BEPC shares?

Q: I have held NPI for sometime and am down almost 8%. I know you're not a big fan of the stock currently and prefer BEP, H or FTS. That said, 9 of 9 analysts are rating NPI as a Strong Buy. None of the others are rated as highly. What are you seeing that they do not?

Q: How would you rank these electricity producers for a 5 year hold, probably longer.

Please add what other companies are worth consideration

thank you

Q: I own the above high dividend yield Canadian stocks, just under 4% yield and up. I am looking to add maybe 10 to 20 % to 4 or 5 positions. The yield on these is enough for us now so no hurry to sell anything.
Retired, but still looking at safety of capital. I have left out O&G plays and other potentially riskier plays. (except Enbridge)

Which of these, or other stocks do you believe have the greatest potential for price appreciation over the next couple of years if/when interest rates drop.

I am looking for your top 5, here but feel free to add other picks.

Thank you. Take as many credits as needed.