* Note: Prices are in Million (M) USD.
Description:
Brookfield Business Corporation (BBUC) is a diversified investment firm with a strategic focus on sectors such as healthcare, construction, and wastewater services across key global markets including the United States, Europe, Australia, the United Kingdom, Canada, and Brazil. With its headquarters in New York, the company leverages its extensive expertise and operational capabilities to identify and capitalize on high-quality investment opportunities, driving growth and value for its stakeholders. BBUC is committed to sustainable business practices and operational excellence, positioning itself as a leader in its targeted industries.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Note: Financial institutions (banks/insurers/brokers/REITs) are evaluated using sector, P/E, growth, ROE and other factors. The 3.5× Net Debt/EBITDA rule is skipped to avoid misleading signals; however, Cash/Debt/EBITDA are still displayed and counted for scoring.
Cash : $613 M
Debt : $8,096 M
EBITDA : $886 M
Net Debt (Debt - Cash): $7,483 M
This criteria used industry in which company operates:
Sector: Industrials
Industry: Asset management
Based on industry, 3 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Message: Cannot calculate PE Ratio since EPS is either 0 or negative.
Using default values for calculation.
Forward PE Ratio (using default values): 20.00
Since Forward PE Ratio is between 20 - 25, 2 points assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Using last 7 overlapping fiscal years (max 20).Average Free Cash Flow: $-205 M
Average Revenue: $7,933 M
Revenue Converted To Free Cash Flow (%): -2.6%
Since Free Cash Flow (FCF) to Revenue percentage is non-positive, 0 point assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-12-31): $8,208 M
Revenue 5 Years Ago (2019-12-31): $9,903 M
Total Growth over 5 Years: -17.1%
5-Year Revenue CAGR (Historical): -3.7%
Forward 5-Year CAGR (Tapered): -3.3%
Since historical Revenue CAGR is between 0 - 5, 1 point assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-12-31): $73 M
Share Count 5 Years Ago (2020-12-31): $99 M
Company is buying back its own shares, 3 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $0.00
Trailing 12-Month Earnings Per Share (EPS): $0.00
Average Earnings Per Share (EPS): $0.00
Dividend Per Share (DPS): $0
Payout Ratio: 0%
Dividend Yield: 1%
EPS is non-positive; payout ratio not meaningful. 0 point assigned.
Since Dividend Yield is less than 1, 0 point assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Using last 4 valid ROE years (max 20).Average ROE: 72.3%
Since Average ROE is greater than 20, 5 points assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $34.04
52-Week Low: $21.43
Threshold Price (15% Above 52-Week Low): $24.64
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $2,383 M
Since Market Cap is less than 10B, 1 point assigned.
% Exposure to Total Portfolio
Based on the market cap, we recommend do not exceed 2% exposure of Total Portfolio.
Warren Buffett's Owners' Earnings:
Owners' Earnings (FCF/Share, latest positive annual) (2020-12-31): $0.51
Note: Many fast-growing companies reinvest heavily, so Owners' Earnings may appear low.
Consider other factors in your valuation.
Value-Trade has assigned 15 points to above Brookfield Business Corp (BBUC) stock.
Heads up: One or more P/E inputs look exaggerated and may skew the blend.
• ROE Based PE 50.00 (>2× median)
Further research is recommended; please use your own due diligence.
In such cases, multiplying earnings by the long-run average P/E typically gives a closer, more reliable fair value.
Fair Value PE 12, Industry Based PE 15, ROE Based PE 50, Risk-Free Anchored PE (25% MoS) 18.2. Based on these 4 values, average assigned is 23.80. The fair value of Brookfield Business Corp (BBUC) stock cannot be calculated since EBITDA and EPS are either 0 or negative.
