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Investing.com - BMO Capital raised its price target on Brookfield Business Partners L.P. (NYSE:BBU) to $38.00 from $35.00 on Monday, while maintaining an Outperform rating on the stock. The company has shown strong momentum with a 20.3% return over the past year, and according to InvestingPro data, management has been actively buying back shares.
The price target increase was primarily due to BMO incorporating the estimated present value of 45x production tax credits into its enterprise valuation for Clarios, one of Brookfield Business Partners’ portfolio companies.
BMO Capital described Brookfield Business Partners as its "Preferred Value Idea" and noted that the backdrop for the company continues to improve, supported by the gradual easing of macroeconomic concerns and lower financial leverage at the corporate level.
The firm also highlighted solid performance across Brookfield’s portfolio, active merger and acquisition markets, and the preservation of 45x production tax credits as positive factors for the company.
BMO Capital pointed out that Brookfield Business Partners units currently trade at a significant discount to intrinsic value, with a price-to-net asset value ratio of approximately 0.55x. InvestingPro offers additional insights through its comprehensive Pro Research Report, available for over 1,400 US stocks, helping investors make informed decisions based on detailed analysis and valuation metrics.
In other recent news, RBC Capital has upgraded Brookfield Business Partners to an outperform rating. The investment firm also increased its price target for the company from $30.00 to $33.00. This decision was influenced by Brookfield Business Partners’ strong investment performance and its unique investment strategy. RBC Capital highlighted the company’s effective capital deployment in recent years as a significant factor contributing to this optimistic outlook. These recent developments suggest potential growth in net asset value for the company. Investors may find this information useful when considering Brookfield Business Partners’ future prospects. The upgrade reflects confidence in the company’s strategic direction and performance.
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