Brookfield Business Profitability Analysis

BBU Stock  USD 18.34  1.34  6.81%   
Based on Brookfield Business' profitability indicators, Brookfield Business Partners is performing exceptionally good at the present time. It has a great likelihood to showcase excellent profitability results in July. Profitability indicators assess Brookfield Business' ability to earn profits and add value for shareholders.
 
Net Income  
First Reported
2013-12-31
Previous Quarter
505 M
Current Value
17 M
Quarterly Volatility
111.7 M
 
Yuan Drop
 
Covid
At this time, Brookfield Business' Days Sales Outstanding is comparatively stable compared to the past year. EV To Sales is likely to gain to 0.86 in 2024, whereas Price To Sales Ratio is likely to drop 0.03 in 2024. At this time, Brookfield Business' Income Before Tax is comparatively stable compared to the past year. Total Other Income Expense Net is likely to gain to about 3.3 B in 2024, despite the fact that Income Tax Expense is likely to grow to (53.2 M).
Current ValueLast YearChange From Last Year 10 Year Trend
Gross Profit Margin0.03790.0399
Notably Down
Slightly volatile
For Brookfield Business profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Brookfield Business to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Brookfield Business Partners utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Brookfield Business's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Brookfield Business Partners over time as well as its relative position and ranking within its peers.
  
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Is Construction & Engineering space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Brookfield Business. If investors know Brookfield will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Brookfield Business listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.32)
Dividend Share
0.25
Earnings Share
6.38
Revenue Per Share
245.803
Quarterly Revenue Growth
(0.13)
The market value of Brookfield Business is measured differently than its book value, which is the value of Brookfield that is recorded on the company's balance sheet. Investors also form their own opinion of Brookfield Business' value that differs from its market value or its book value, called intrinsic value, which is Brookfield Business' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Brookfield Business' market value can be influenced by many factors that don't directly affect Brookfield Business' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Brookfield Business' value and its price as these two are different measures arrived at by different means. Investors typically determine if Brookfield Business is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Brookfield Business' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Brookfield Business Return On Asset vs. Return On Equity Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Brookfield Business's current stock value. Our valuation model uses many indicators to compare Brookfield Business value to that of its competitors to determine the firm's financial worth.
Brookfield Business Partners is number one stock in return on equity category among its peers. It also is number one stock in return on asset category among its peers reporting about  0.12  of Return On Asset per Return On Equity. The ratio of Return On Equity to Return On Asset for Brookfield Business Partners is roughly  8.12 . At this time, Brookfield Business' Return On Equity is comparatively stable compared to the past year. Comparative valuation analysis is a catch-all technique that is used if you cannot value Brookfield Business by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.

Brookfield Return On Asset vs. Return On Equity

Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.

Brookfield Business

Return On Equity

 = 

Net Income

Total Equity

 = 
0.2
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Return on Asset or ROA shows how effective is the management of the company in generating income from utilizing all of the assets at their disposal. It is a useful ratio to evaluate the performance of different departments of a company as well as to understand management performance over time.

Brookfield Business

Return On Asset

 = 

Net Income

Total Assets

 = 
0.025
Return on Asset measures overall efficiency of a company in generating profits from its total assets. It is expressed as the percentage of profits earned per dollar of Asset. A low ROA typically means that a company is asset-intensive and therefore will needs more money to continue generating revenue in the future.

Brookfield Return On Asset Comparison

Brookfield Business is currently under evaluation in return on asset category among its peers.

Brookfield Business Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Brookfield Business, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Brookfield Business will eventually generate negative long term returns. The profitability progress is the general direction of Brookfield Business' change in net profit over the period of time. It can combine multiple indicators of Brookfield Business, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income-745.2 M-707.9 M
Operating Income549.9 M372.8 M
Income Before Tax3.7 B3.8 B
Total Other Income Expense Net3.1 B3.3 B
Net Income490.8 M544.2 M
Income Tax Expense-56 M-53.2 M
Net Income From Continuing Ops443 M580.9 M
Net Income Applicable To Common Shares49.5 M58.7 M
Interest Income2.7 B2.9 B
Net Interest Income-3.5 B-3.4 B
Change To Netincome-180.6 M-171.5 M
Net Income Per Share 7.58  4.06 
Income Quality 4.42  4.64 
Net Income Per E B T 0.15  0.15 

Brookfield Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Brookfield Business. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Brookfield Business position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Brookfield Business' important profitability drivers and their relationship over time.

Brookfield Business Profitability Trends

Brookfield Business profitability trend refers to the progression of profit or loss within a business. An upward trend means that Brookfield Business' profit has generally increased over time, and a downward profitability trend means profits are declining. Recognizing problems early in profitability trends allows investors to address revenue and cost issues in advance. Investors and analysts usually monitor three types of profitability trends: gross, operating, and net. Gross profit is the difference between revenue and costs of goods sold. Operating profit is Brookfield Business' gross profit minus its overhead. After you account for other unusual revenue, expenses, and costs, you get net profit. Gross profit trends are often a good indicator of future profitability. If you have high gross profit margins, you have a better chance to cover overhead and make money.

Brookfield Business Profitability Drivers Correlations

One of the toughest challenges investors face today is learning how to quickly synthesize and read into endless financial statements and information provided by the company, SEC reporting, and various external parties. Understanding the correlation between Brookfield Business different financial indicators related to revenue and profit generation helps investors identify and prioritize their investing strategies towards Brookfield Business in a much-optimized way. Analyzing correlations between profit drivers that are directly associated with dollar figures is the most effective way to break down Brookfield Business' future profitability.

Use Brookfield Business in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Brookfield Business position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Brookfield Business will appreciate offsetting losses from the drop in the long position's value.

Brookfield Business Pair Trading

Brookfield Business Partners Pair Trading Analysis

The ability to find closely correlated positions to Brookfield Business could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Brookfield Business when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Brookfield Business - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Brookfield Business Partners to buy it.
The correlation of Brookfield Business is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Brookfield Business moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Brookfield Business moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Brookfield Business can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your Brookfield Business position

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Heavy Metals
Heavy Metals Theme
Companies involved in mining, production, and distribution of various industrial metals and minerals. The Heavy Metals theme has 47 constituents at this time.
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Additional Tools for Brookfield Stock Analysis

When running Brookfield Business' price analysis, check to measure Brookfield Business' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Brookfield Business is operating at the current time. Most of Brookfield Business' value examination focuses on studying past and present price action to predict the probability of Brookfield Business' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Brookfield Business' price. Additionally, you may evaluate how the addition of Brookfield Business to your portfolios can decrease your overall portfolio volatility.