You don’t have to have a ton of money to invest for this approach to work wonders. If you have $3,000 or so, there has a high dividend yield shares that you can buy right now and let the money roll in. This stock is Brookfield Renewable Partners (NYSE:BEP).
The tradition of the family
Brookfield Renewable Partners is a member of a family of limited partnerships (LPs) managed by Brookfield Asset Managers. Its sister companies include Brookfield Business Partners, Brookfield Infrastructure Partnersand Brookfield Property Partners.
Each of these companies focus on the ownership and management of assets in their niche markets which can generate a recurring cash flow and to distribute the cash back to holders of units (the LP equivalent for the shareholders). Brookfield Renewable Partners seems to be in great shape to maintain that family tradition.
The company is the owner of hydro, wind, solar and storage facilities spread over four continents. In total, Brookfield Renewable power can generate more than 19,000 megawatts of electric power. It also has a pipeline of 13 000 megawatts of capacity.
About three-quarters of Brookfield Renewable, the funds from operations (FFO) of its hydroelectric facilities. Most of the rest of its funds from operations stems from the company’s solar and wind installations. A pending acquisition of transforming the field will give an impetus to these enterprises.
Brookfield Renewable power’s business is stable as they come. Its only the largest non-governmental customer contributes only 2% of the total of the cash flows. Approximately 95% of its total cash flow is contracted over a long period. The company the weighted average remaining contract term is 14 years.
This strong cash flow enables Brookfield Renewable Partners to reward investors with large distributions. Its yield currently stands at around 4.5%. The company has increased its distribution of 31% over the past five years.
A renewable future
Brookfield Renewable has told investors last year that he is “one of the few of the future of stocks” on the market. I don’t think it is an exaggeration. It is not a secret that the production of energy in the future will increasingly rely on renewable sources. There are two main reasons for this trend is unstoppable.
First of all, wind and solar energy are already more cost-effective sources of energy than natural gas. And their costs are likely to become even more attractive in the course of the next decade.
Second, many countries around the world are keen to reduce their carbon footprint. The united Kingdom, for example, set a goal of 55% of the production of renewable energy by 2030. China has a goal of 50% in the same period, while India seeks to generate 40% of its energy from renewable sources by the end of the decade. The UNITED states have not established a national target, but several large states, including California and New York.
Each of these countries and the united states are significantly below their targets 2030 right now. That presents a significant growth opportunity for renewable energy stocks (and of Brookfield Renewable Partners, in particular) over the next 10 years and beyond.
What you can reasonably expect to
How much money can you make with a $3, 000 investment in Brookfield Renewable Partners? There are some factors that could have an impact on your returns, of course. But you can reasonably expect to raise some serious cash.
The company’s investment objective is to provide a annualized total returns of between 12% and 15% over the long term. This objective includes the distribution of annual increases between 5% and 9%. Can-Brookfield Renewable power achieve these goals? Yes, I think so. It has beat the upper end of this range over the past five years.
If the company offers an average annual total return of 15%, an initial investment of 3 000 $today, could double in the next five years. If Brookfield Renewable fails to respond to the lower end of its predicted range, it would take a little more than six years to double. Anyway, the purchase of this high-yield stock now seems to be a simple and smart to make money over the long term.