About this blog: I have been investing for 25 years, professionally and personally. I look for stocks that have a high probability of compounding at 15% for at least 5 years with limited downside. I write these stocks up on my blog. You can find more about me, my philosophy, my mental models, and my portfolio structure on my site.
For background on how I think about Brookfield, see my original review here and my investor day preview here, which laid out how I reorganise Plan Value and what needs to happen for the stock to work.
This note is about Brookfield Corp (BN). It has 4 parts:
Conclusions, for those who want to keep it short.
Performance vs. past plans: 2021 investor day lookback.
2026 investor day takeaways.
Detailed investor day notes.
Future notes will cover the nature of Distributable Earnings, how BN is turning into an insurance company, and each of the major components of Plan Value.
Conclusions
BN has a habit of setting aggressive targets - and missing them. Specifically, they have a track record of overestimating growth, overvaluing assets for Plan Value (their sum of the parts), and vastly overestimating carried interest. They are 20-25% behind both the Plan Value per share and distributable earnings before realisations (DEBR) targets set for 2026 at the 2021 investor day.
That said, the absolute performance of both metrics is respectable - DEBR has compounded at 16% and plan value per share at 11% - and there are several reasons to believe the next 5 years might be better than the last: