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RBC Capital assumed coverage of Brookfield Business Partners L.P. (NYSE:BBU) with an outperform rating on Wednesday, raising the price target to $33.00 from $30.00. According to InvestingPro data, BBU’s stock has shown strong momentum with a 28% return over the past year, trading near $25.
The investment firm cited BBU’s strong investment performance track record as a key factor in its decision, noting the company’s differentiated investment strategy and capital deployment over recent years have positioned it for potential strong NAV growth. InvestingPro analysis confirms management’s active share repurchase program, with additional ProTips available for subscribers.
RBC Capital described BBU as effectively representing a limited partner interest in Brookfield’s private equity strategies, providing investors with a liquid method of accessing this asset class.
The firm highlighted BBU’s current valuation as attractive, with the company actively supporting its share price through ongoing share buybacks.
BBU serves as Brookfield’s private equity arm, focusing on acquiring and managing business services and industrial operations across multiple sectors globally.
In other recent news, Brookfield Business Partners reported mixed first-quarter results, with earnings surpassing analyst expectations but revenue experiencing a notable decline. The company posted adjusted earnings per share of $0.38 for Q1 2025, up from $0.23 in the same quarter last year. However, revenue fell sharply to $6.75 billion from $12.02 billion in Q1 2024. Despite the revenue drop, Brookfield Business Partners saw its Adjusted EBITDA rise to $591 million, indicating improved operational efficiency. The Industrials segment stood out with Adjusted EBITDA increasing to $304 million, aided by $72 million in tax benefits from its advanced energy storage operation. Meanwhile, the Business Services segment experienced a modest increase in Adjusted EBITDA, whereas the Infrastructure Services segment saw a decline. The company also announced plans to acquire Antylia Scientific for approximately $1.3 billion, aiming to secure a 25% stake with an investment of about $160 million. Brookfield Business Partners continues to maintain its quarterly dividend of $0.0625 per unit, despite the mixed financial results.
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