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Brookfield (TSX:BN) Valuation Check After Launch Of $100b AI Infrastructure Fund

Simply Wall St · 5d ago

Why Brookfield’s AI infrastructure move matters for shareholders

Brookfield (TSX:BN) has drawn fresh attention after launching its inaugural AI Infrastructure Fund, targeting up to $100b of AI related assets across data centers, fuel cell powered facilities, and wider AI focused infrastructure.

See our latest analysis for Brookfield.

Brookfield’s recent AI Infrastructure Fund announcement lands after a solid stretch of momentum, with a 7 day share price return of 7.13% and a 1 year total shareholder return of 25.17%. The 3 and 5 year total shareholder returns of 130.07% and 169.05% point to a trend that long term holders will likely be watching closely as the shares trade around CA$67.90.

If this AI infrastructure push has you thinking about where else capital is flowing in the sector, it could be a useful time to look at high growth tech and AI stocks as potential next ideas.

With Brookfield trading around CA$67.90 after strong multi year returns, and with analyst targets sitting below the current price, investors have to ask: is AI upside still underappreciated, or is the market already pricing in future growth?

Price-to-Earnings of 132.8x: Is it justified?

Brookfield’s current valuation looks rich on earnings, with a P/E of 132.8x against a last close of CA$67.90 and peers trading on far lower multiples.

The P/E ratio compares the share price to earnings per share and is a quick way to see how much investors are paying for each dollar of profit. For a diversified asset manager like Brookfield, it often reflects how the market views the quality, durability, and growth potential of fee and investment income.

Here, the signals point to a premium. Brookfield’s P/E of 132.8x is described as expensive relative to a peer average of 53.6x and particularly high compared to the Canadian Capital Markets industry average of 9.6x. That is a wide gap, which suggests the market is paying a substantially higher price for Brookfield’s earnings than for many comparable companies.

This kind of spread indicates the shares are valued at a multiple that is several times the broader industry level, rather than sitting close to sector norms.

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price-to-Earnings of 132.8x (OVERVALUED)

However, you also have to weigh risks such as Brookfield’s recent 84% annual revenue contraction, as well as the possibility that high expectations for its AI push prove too optimistic.

Find out about the key risks to this Brookfield narrative.

Build Your Own Brookfield Narrative

If you look at this and reach a different conclusion, or simply want to test your own assumptions against the numbers, you can build a custom Brookfield thesis in just a few minutes with Do it your way.

A great starting point for your Brookfield research is our analysis highlighting 1 key reward and 3 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If Brookfield’s AI story has you thinking bigger, do not stop here. The right watchlist can start with one stock but rarely ends with one.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.