Renewable energy investments make for some of the best long-term investments in the market today. There’s no denying the fact that climate change is real and that fossil fuel-burning facilities are going to be a thing of the past within a generation, leaving the future of power generation firmly in the hands of renewable energy companies, and one such company that is increasingly coming into focus with investors is Brookfield Renewable Partners (TSX:BEP.UN)(NYSE:BEP).
To be clear, there’s no shortage of viable renewable energy investments on the market, but there are several compelling reasons why Brookfield Renewable is the one stock that investors may want to consider at the moment.
A solid background and portfolio
As the name suggests, Brookfield is an offshoot of the well-known Brookfield Asset Management, which has over a century of experience in acquiring infrastructure, real estate, and just about any type of distressed asset around the world with a massive war chest to finance those acquisitions. Brookfield Renewable was set up just over a decade ago and has since grown into a powerhouse in the renewable energy sector, with a portfolio of 930 facilities that are scattered across four continents that collectively have a capacity of over 18,000 MW.
The vast majority of those renewable facilities are hydroelectric facilities, but the company also has wind and solar elements and provides distributed generation and storage capabilities.
If Brookfield Renewable was just maintaining that large number of sites, the company would still be a great investment, but investors should also take note of the fact that Brookfield Renewable continues to add to its portfolio. By way of example, just last month, the company signed an agreement to acquire two 210 MW wind farms in India, boosting Brookfield Renewable’s wind portfolio in India to 510 MW. The wind farms also have an existing long-term PPA in place that spans 25 years.
Strong results and income-earning potential
Brookfield Renewable announced results for the first fiscal quarter of 2019 earlier this month, which continued to show the incredible potential that is unfolding in the renewable energy sector. Specifically, the company reported FFO for the quarter in the amount of US$227 million, or US$0.73 per unit, surpassing the US$193 million, or US$0.62 per unit, declared in the same quarter last year by an impressive 18%. In terms of net income, Brookfield Renewable shattered the US$8 million, or $0.03 per unit, reported in the same quarter last year by posting net income of US$43 million, or US$0.14 per share.
Turning to growth, Brookfield Renewable witnessed a healthy bump across all of its segments in the most recent quarter. Specifically, earnings from the hydro as well as the wind and solar businesses saw year-over-year increases of 5% and 43%, respectively. The same could be said of Brookfield Renewable’s other operations, which saw a notable US$7 million bump in the quarter.
The strong earnings and growth numbers reported in the most recent quarter not only paint the picture that Brookfield is a great long-term investment for growth seekers but also sets the stage for the company’s quarterly dividend, which currently provides a very appetizing 6.56% yield, making it one of the best-paying stocks in the renewable energy space.
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Fool contributor Demetris Afxentiou has no position in any of the stocks mentioned. The Motley Fool owns shares of Brookfield Asset Management and BROOKFIELD ASSET MANAGEMENT INC. CL.A LV. Brookfield Renewable Partners is a recommendation of Dividend Investor Canada.
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