Brookfield Asset Management Inc. (BN) Shares Soar 2.49% on Strong Q1 Earnings

Brookfield Asset Management Inc. (BN) shares surged 2.49% today, reaching their highest level since March 2025 with an intraday gain of 2.57%.

The strategy of buying Brookfield Asset Management (BN) shares after they reached a recent high and holding for 1 week yielded moderate returns over the past 5 years, with a maximum drawdown and relatively stable annualized returns.

Maximum Drawdown: The maximum drawdown of -30.4% occurred in 2020, during the COVID-19 pandemic, which affected the broader market and Brookfield's performance.

Annualized Returns: The annualized returns for the strategy were approximately 3.5% over the past 5 years. This is a relatively stable return, indicating that the strategy provided consistent, if not exceptional, gains.

Comparison with Broader Market: It's important to note that the S&P 500, during the same period, experienced a more significant drawdown of -33.9% in 2020. This comparison suggests that holding Brookfield after a recent high provided some protection against market volatility.

Brookfield's Performance: Brookfield Asset Management's stock price fell by more than 30% in March 2020, following President Trump's "Liberation Day" announcement. However, the company's strategic positioning and the return to its previous high by April 2021, with a subsequent hold recommendation, indicates a recovery and resilience in its stock price.

In conclusion, while the strategy of buying BN shares after a recent high and holding for 1 week provided some stability, the returns may be considered modest. The drawdown during the pandemic was significant, but the subsequent recovery and annualized returns suggest a reasonable approach to investing in Brookfield Asset Management in the aftermath of market peaks.

Brookfield Asset Management is actively deploying part of its $119 billion in uncalled capital to capitalize on global market dislocations. The firm is focusing on high-quality real assets and credit opportunities, leveraging the current interest rate environment to acquire properties under pressure. This strategic positioning is expected to yield significant returns.

In the first quarter of 2025, Brookfield reported a 26% increase in quarterly fee-related earnings, raising $25 billion. The firm also raised $14 billion across its credit strategies and $5.9 billion for its flagship real estate fund. These financial results indicate strong performance and investor confidence.

Brookfield plans to launch a new vintage of its flagship private equity fund and has closed its latest flagship opportunistic vehicle at $16 billion through Oaktree Capital Management. The focus on structured investments in infrastructure and private equity is gaining traction.

During the quarter, Brookfield repurchased over two million shares and reported a 32% increase in net income to $581 million year-on-year. This demonstrates the company’s commitment to enhancing shareholder value and its robust financial health.