3 Recent Buys – BAM, BIP, CU

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A quick update on three recent purchases in my portfolio. No new companies in the portfolio in this edition, but continued adding to my existing positions where I saw relatively good valuation.

  • First purchase: I added 50 shares of Brookfield Asset Management (BAM.A.TO) @ CAD$63.70. BAM continues to acquire high quality assets all around the world and is arguably the best alternate asset manager in the world. The stock yields 1.32% and adds US$32.00 in annual dividends.
  • Second purchase: I added 50 shares of Brookfield Infrastructure Partners LP (BIP.UN.TO) @ CAD$57.10. The stock yields 4.6% and adds US$100.50 in annual dividends.
  • Third purchase: I added 100 shares of Canadian Utilities (CU.TO) @ $35.95. CU currently yields 4.7% and this purchase adds a further $169.00 in annual dividends.

What are you thoughts on the purchases above. Leave a comment below.

Full Disclosure: Long all stocks mentioned. Our full list of holdings is available here.

7 thoughts on “3 Recent Buys – BAM, BIP, CU

  1. JC says:

    Love seeing those purchases R2R! I really want to add some BIP to my portfolio, but I’m not sure of the tax implications if I hold it in and IRA. From what I gather there shouldn’t be any issue, but our tax system in incredibly complex. BIP states that they don’t anticipate any UBTI which, from my understanding, is the problem child with owning shares in an IRA. I’m debating whether I want to just pick up some shares in my taxable account which would simplify things, but also take a big bite out of the distributions due to taxes. And the share price constantly climbing doesn’t help matters.

    Have you looked into BEP? I’m pretty sure there’s the same potential, although not expected issues regarding UBIT for IRAs here in the US, with BEP but I like the renewable energy space too.

    • I really have no clue how the US tax system works and whether BIP makes sense to hold in IRAs. Sorry, wish I could help you there.

      BEP is good if you are looking for exposure to the renewable space, but I think BIP is a far more superior investment vehicle — with plenty more growth in the future (with downside protection) due to the nature of investments. The infrastructure components held are more moaty (toll roads, railroads, towers, data centers, port terminals etc). There is only going to be one or two options for these kind of infrastructure elements in the respective geographic region. Take the recent purchase of Indian cell tower asset from Reliance Jio for e.g., The purchase gives BIP the most number of towers in India leapfrogging American Tower which has been buying smaller chunks of towers in India for years, and also >towers than the newly merged Bharti Infratel-Indus towers. If American Tower is a great business (it certainly is), then BIP is fighting them hard overseas and giving them a run for their money. Similarly, if you look at the Asciano takeover from a few years ago (which BAM/BIP failed in complete takeover due to competing offers & competition board getting involved, but BAM/BIP still managed to get a decent chunk of that asset), BIP controls (with others) the Australian Patrick container terminals & Bulk/Automotive Port Services. No one else is opening brand new ports and all international trade from Australia has to go through this channel of operation that BIP controls. That is a fantastic moaty business to own imo.

      You may also want to look at the parent company BAM. All the subsidiaries be it BIP, BEP, BPY, BBU — all pay a fee to the parent company…so, over the long run as the subsidiaries grow, BAM will continue accumulating cash & growing even more. The long term prospects are phenomenal imo.

      cheers
      R2R

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