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Relative valuation derived from Industrials sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 37.7GRADE D
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
105.4%
Sector: 8.9%
Dividend Analysis audit
No Dividend
This company does not currently pay a dividend.
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, Brookfield Business Partners L.P. (BBU) receives a "Hold" rating with a composite score of 54.0/100, ranked #653 out of 4446 stocks. Key factor scores: Quality 38/100, Value 90/100, Momentum 49/100. This is quantitative analysis only — not investment advice.
Brookfield Business Partners L.P. (BBU) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does Brookfield Business Partners L.P. Do?
Brookfield Business Partners L.P. is a private equity firm specializes in acquisition. The firm typically invests in business services, construction, energy, and industrials sector. It prefers to take majority stake in companies. The firm seeks returns of at least 15% on its investments. Brookfield Business Partners L.P. is based in Hamilton, Bermuda. Brookfield Business Partners L.P. operates as a subsidiary of Brookfield Asset Management Inc. Brookfield Business Partners L.P. (BBU) is classified as a mid-cap stock in the Industrials sector, specifically within the Construction industry. The company is led by CEO Cyrus Madon and employs approximately 16,000 people. With a market capitalization of $2.8B, BBU is one of the notable companies in the Industrials sector.
Brookfield Business Partners L.P. (BBU) Stock Rating — Hold (April 2026)
As of April 2026, Brookfield Business Partners L.P. receives a Hold rating with a composite score of 54.0/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.BBU ranks #653 out of 4,446 stocks in our coverage universe. Within the Industrials sector, Brookfield Business Partners L.P. ranks #113 of 752 stocks, placing it in the top quartile of its Industrials peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
BBU Stock Price and 52-Week Range
Brookfield Business Partners L.P. (BBU) currently trades at $30.65. The stock lost $0.40 (1.3%) in the most recent trading session. The 52-week high for BBU is $37.75, which means the stock is currently trading -18.8% from its annual peak. The 52-week low is $18.63, putting the stock 64.5% above its annual trough. Recent trading volume was 45K shares, suggesting relatively thin trading activity.
Is BBU Overvalued or Undervalued? — Valuation Analysis
Brookfield Business Partners L.P. (BBU) carries a value factor score of 90/100 in the Blank Capital model, suggesting the stock trades at a meaningful discount to its fundamental earning power. The price-to-book ratio stands at 0.82x, versus the sector average of 2.23x. The price-to-sales ratio is 0.02x, compared to 0.50x for the average Industrials stock. On an enterprise value basis, BBU trades at 1.33x EV/EBITDA, versus 5.70x for the sector.
Based on these multiples, Brookfield Business Partners L.P. appears attractively valued relative to both its sector peers and the broader market. Value-oriented investors may find the current entry point compelling, particularly if the company's fundamental quality metrics also score well.
Brookfield Business Partners L.P. Profitability — ROE, Margins, and Quality Score
Brookfield Business Partners L.P. (BBU) earns a quality factor score of 38/100, signaling below-average profitability metrics relative to the broader market. The return on equity (ROE) is 105.4%, compared to the Industrials sector average of 8.9%, which demonstrates strong shareholder value creation. Return on assets (ROA) comes in at 4.7% versus the sector average of 3.3%.
On a margin basis, Brookfield Business Partners L.P. reports gross margins of 14.1%, compared to 35.8% for the sector. The operating margin is 7.2% (sector: 6.2%). Net profit margin stands at 2.2%, versus 3.9% for the average Industrials stock. Profitability is below benchmark levels, which may reflect industry headwinds, elevated reinvestment, or structural challenges.
BBU Debt, Balance Sheet, and Financial Health
Brookfield Business Partners L.P. has a debt-to-equity ratio of 1081.0%, compared to the Industrials sector average of 70.0%. This elevated leverage warrants close monitoring, as it increases the company's sensitivity to rising interest rates and economic downturns. Total debt on the balance sheet is $36.72B. Cash and equivalents stand at $3.24B.
BBU has a beta of 1.61, meaning it is more volatile than the broader market — a $10,000 investment in BBU would be expected to move 61.1% more than the S&P 500 on any given day. The stability factor score for Brookfield Business Partners L.P. is 57/100, reflecting average volatility within the normal range for its sector.
Brookfield Business Partners L.P. Revenue and Earnings History — Quarterly Trend
In TTM 2026, Brookfield Business Partners L.P. reported revenue of $40.62B and earnings per share (EPS) of $-0.50. Net income for the quarter was $895M. Gross margin was 14.1%. Operating income came in at $2.92B.
In FY 2024, Brookfield Business Partners L.P. reported revenue of $40.62B and earnings per share (EPS) of $-0.50. Net income for the quarter was $895M. Gross margin was 14.1%. Revenue grew -26.2% year-over-year compared to FY 2023. Operating income came in at $2.92B.
In FY 2023, Brookfield Business Partners L.P. reported revenue of $55.07B and earnings per share (EPS) of $6.49. Net income for the quarter was $3.78B. Gross margin was 9.2%. Revenue grew -4.0% year-over-year compared to FY 2022. Operating income came in at $2.50B.
In FY 2022, Brookfield Business Partners L.P. reported revenue of $57.38B and earnings per share (EPS) of $0.48. Net income for the quarter was $240M. Gross margin was 7.4%. Revenue grew 23.2% year-over-year compared to FY 2021. Operating income came in at $2.27B.
Over the past 8 quarters, Brookfield Business Partners L.P. has demonstrated a growth trajectory, with revenue expanding from $37.17B to $40.62B. Investors analyzing BBU stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
BBU Dividend Yield and Income Analysis
Brookfield Business Partners L.P. (BBU) does not currently pay a dividend. This is common among smaller companies in the Construction industry that prefer to reinvest cash flows into business expansion rather than returning capital to shareholders. Income-focused investors looking for Industrials dividend stocks may want to explore other Industrials stocks or use the stock screener to filter by dividend yield.
BBU Momentum and Technical Analysis Profile
Brookfield Business Partners L.P. (BBU) has a momentum factor score of 49/100, reflecting neutral trend characteristics. The stock is neither significantly outperforming nor underperforming the broader market on a momentum basis. The investment factor score is 73/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 38/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
BBU vs Competitors — Industrials Sector Ranking and Peer Comparison
Comparing BBU against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full BBU vs S&P 500 (SPY) comparison to assess how Brookfield Business Partners L.P. stacks up against the broader market across all factor dimensions.
BBU Next Earnings Date
No upcoming earnings date has been announced for Brookfield Business Partners L.P. (BBU) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy BBU? — Investment Thesis Summary
Brookfield Business Partners L.P. presents a balanced picture with arguments on both sides. The quality score of 38/100 flags below-average profitability. The value score of 90/100 suggests attractive pricing relative to fundamentals.
In summary, Brookfield Business Partners L.P. (BBU) earns a Hold rating with a composite score of 54.0/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on BBU stock.
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Institutional Research Dossier
Brookfield Business Partners L.P. (BBU) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
Brookfield Business Partners L.P. (BBU) receives a Hold rating, driven by a mixed financial profile. While the company exhibits strong value characteristics and robust capital allocation, concerns arise from its high debt levels and inconsistent profitability. The current valuation appears attractive based on EV/EBITDA, but the high debt and volatile historical performance warrant caution.
BBU operates as a private equity arm of Brookfield Asset Management, focusing on acquiring and improving businesses across various sectors. Its success hinges on its ability to identify undervalued assets, implement operational improvements, and generate attractive returns. However, the cyclical nature of its target industries and the inherent risks associated with leveraged buyouts contribute to the uncertainty surrounding its future performance, justifying the neutral Hold rating.
Business Strategy & Overview
Brookfield Business Partners operates as a global private equity firm, specializing in acquiring and managing businesses across diverse sectors, including business services, construction, energy, and industrials. The core strategy revolves around identifying undervalued or distressed assets with the potential for operational improvement and long-term value creation. BBU typically seeks controlling stakes in its investments, allowing it to exert significant influence over management and strategic direction.
The firm's investment approach is characterized by a focus on operational expertise and a hands-on management style. BBU leverages the extensive resources and operational capabilities of its parent company, Brookfield Asset Management, to drive efficiency improvements, optimize capital structures, and enhance the competitive positioning of its portfolio companies. This operational focus distinguishes BBU from traditional private equity firms that primarily rely on financial engineering to generate returns.
BBU's strategic positioning within the Brookfield ecosystem provides it with a significant advantage in sourcing and executing deals. The firm benefits from Brookfield's global network, industry expertise, and access to capital. This allows BBU to pursue larger and more complex transactions than it could undertake independently. Furthermore, BBU's affiliation with Brookfield enhances its credibility and reputation, making it a preferred partner for sellers seeking a long-term owner with a proven track record of value creation.
The company's revenue streams are derived from the operations of its portfolio companies. These revenues are subject to the cyclicality of the underlying industries in which BBU operates. For example, construction revenues are sensitive to economic conditions and infrastructure spending, while energy revenues are influenced by commodity prices and regulatory policies. BBU mitigates this risk by diversifying its investments across multiple sectors and geographies.
BBU's success depends on its ability to execute its operational improvement strategy effectively. This requires a deep understanding of the industries in which it operates, as well as the ability to identify and implement specific initiatives to enhance efficiency, reduce costs, and improve profitability. The firm's management team has a proven track record of operational excellence, but there is always a risk that it will be unable to replicate its past successes in future investments.
Execution Benchmarks audit
Gross Margin
Core pricing power
14.1%
Sector: 35.8%
-61% VS SCTR
Economic Moat Analysis
Brookfield Business Partners' economic moat is best characterized as Narrow. While the firm benefits from certain competitive advantages, these are not strong enough to warrant a Wide moat rating. The primary source of BBU's moat stems from its operational expertise and the reputation of its parent company, Brookfield Asset Management.
The operational expertise allows BBU to acquire underperforming businesses and implement improvements that drive profitability and value creation. This expertise is not easily replicated by other private equity firms, particularly those that lack the deep industry knowledge and operational capabilities of Brookfield. However, the effectiveness of this expertise is dependent on the specific circumstances of each investment, and there is no guarantee that BBU will be able to successfully turn around every business it acquires.
The reputation of Brookfield Asset Management provides BBU with a significant advantage in sourcing and executing deals. Sellers are often willing to accept lower prices from BBU because they trust that Brookfield will be a responsible and long-term owner of their businesses. This reputation also helps BBU attract and retain talented employees, which is essential for its operational improvement strategy.
However, BBU's moat is not without its limitations. The private equity industry is highly competitive, and there are many other firms with similar strategies and resources. Furthermore, the cyclical nature of BBU's target industries can erode its competitive advantages during economic downturns. For example, a decline in construction activity can reduce the demand for BBU's construction services, regardless of its operational expertise.
Switching costs are generally low in the industries in which BBU operates. Customers can easily switch to alternative providers if they are dissatisfied with BBU's products or services. This limits BBU's ability to raise prices or maintain market share. While BBU's scale provides some cost advantages, these are not significant enough to create a sustainable competitive advantage. Many of BBU's competitors are also large and well-capitalized, and they can often match BBU's prices and terms.
In conclusion, BBU possesses a Narrow economic moat based on its operational expertise and the reputation of Brookfield Asset Management. However, this moat is not impenetrable, and BBU faces significant competition and cyclical risks. The company's ability to maintain and expand its moat will depend on its continued success in identifying and improving underperforming businesses.
Financial Health & Profitability
Brookfield Business Partners exhibits a complex financial profile. Revenue has fluctuated significantly over the past decade, ranging from $7.96 billion in FY2016 to $57.38 billion in FY2022, before settling at $40.62 billion in the latest fiscal year. This volatility reflects the company's acquisition-driven growth strategy and the cyclical nature of its underlying businesses. Net income has also been inconsistent, with periods of substantial profitability interspersed with losses. The most recent fiscal year shows a net income of $895 million, a significant decrease from the $3.78 billion reported in FY2023.
Gross margins have generally improved over time, from a low of 4.0% in FY2017 to 14.1% in the latest fiscal year. Operating margins have followed a similar trend, increasing from -3.5% in FY2016 to 7.2% currently. These improvements suggest that BBU has been successful in implementing its operational improvement strategy and enhancing the profitability of its portfolio companies. However, the net margin of 2.2% is below the sector average of 3.7%, indicating that BBU's profitability is still relatively low compared to its peers.
A major concern is BBU's high debt levels. Total debt stands at $36.72 billion, significantly exceeding its total cash of $3.24 billion. This results in a very high debt-to-equity ratio of 1,081.00, far above the sector average of 70.00. While BBU's business model relies on leverage to finance acquisitions, the current level of debt poses a significant risk, particularly in a rising interest rate environment. The company's ability to service its debt obligations will depend on the continued profitability and cash flow generation of its portfolio companies.
Free cash flow (FCF) has been highly volatile, ranging from negative $18.18 billion in FY2019 to positive $8.42 billion in FY2023. The latest fiscal year shows a healthy FCF of $6.48 billion. This volatility reflects the timing of acquisitions and divestitures, as well as the capital expenditure requirements of BBU's portfolio companies. While the recent FCF generation is encouraging, investors should be aware of the potential for future fluctuations.
The company's ROE of 105.4% is exceptionally high compared to the sector average of 9.2%. However, this is largely due to the company's high leverage, which magnifies both profits and losses. A more conservative measure of profitability, such as return on assets (ROA), would likely be lower. The absence of a current ratio makes it difficult to assess BBU's short-term liquidity position. Further investigation into the composition of current assets and liabilities is needed to determine whether the company has sufficient resources to meet its short-term obligations.
In summary, BBU's financial health is characterized by strong revenue growth potential and improving margins, but also by high debt levels and volatile cash flows. The company's ability to manage its debt obligations and generate consistent profitability will be crucial to its long-term success.
Valuation Assessment
Brookfield Business Partners' valuation presents a mixed picture. The company's P/E ratio is not applicable (N/A), likely due to inconsistent earnings or losses in prior periods, making it difficult to assess its valuation based on this metric. However, the EV/EBITDA ratio of 1.3x is significantly below the sector average of 5.7x, suggesting that BBU may be undervalued relative to its peers. This low EV/EBITDA multiple could be attributed to concerns about the company's high debt levels, volatile earnings, or the cyclical nature of its businesses.
The company's market capitalization is $2.64 billion, while its free cash flow is $6.48 billion. This implies a very high free cash flow yield, which would typically indicate an undervalued stock. However, it's crucial to consider the sustainability of this free cash flow. Given the historical volatility in BBU's FCF, it's uncertain whether the company can maintain this level of cash generation in the future. A more conservative estimate of future FCF may be warranted when assessing the company's intrinsic value.
Compared to its historical valuation, BBU's current EV/EBITDA multiple is relatively low. However, this may reflect a change in investor sentiment towards the company, driven by concerns about its debt levels or the economic outlook. It's important to consider whether the current valuation accurately reflects the company's long-term growth potential and risk profile.
While the low EV/EBITDA multiple and high free cash flow yield suggest that BBU may be undervalued, investors should exercise caution. The company's high debt levels and volatile earnings create significant uncertainty, which may justify a lower valuation. A more comprehensive valuation analysis would require a detailed discounted cash flow (DCF) model, taking into account the company's expected growth rate, discount rate, and terminal value.
Furthermore, the lack of a P/E ratio makes it difficult to compare BBU's valuation to other companies in the industrials sector. Investors should consider other valuation metrics, such as price-to-book ratio or price-to-sales ratio, to gain a more complete understanding of the company's relative valuation.
In conclusion, BBU's valuation appears attractive based on EV/EBITDA and free cash flow yield, but the company's high debt levels and volatile earnings warrant caution. A more conservative valuation approach may be appropriate, given the inherent risks associated with BBU's business model.
Risk & Uncertainty
Brookfield Business Partners faces several key risks that could negatively impact its performance and valuation. One of the most significant risks is its high level of debt. The company's reliance on leverage to finance acquisitions increases its vulnerability to rising interest rates and economic downturns. A significant increase in interest rates could strain BBU's cash flow and reduce its profitability. An economic recession could reduce demand for the products and services of its portfolio companies, leading to lower revenues and earnings.
Another risk is the cyclical nature of the industries in which BBU operates. The construction, energy, and industrials sectors are all sensitive to economic conditions and commodity prices. A downturn in any of these sectors could negatively impact BBU's financial performance. The company attempts to mitigate this risk through diversification, but its portfolio is still exposed to macroeconomic factors.
Operational risks are also a concern. BBU's success depends on its ability to identify and improve underperforming businesses. There is no guarantee that the company will be able to successfully turn around every business it acquires. Furthermore, operational challenges, such as labor disputes, supply chain disruptions, or regulatory changes, could negatively impact the performance of its portfolio companies.
Competition is another significant risk. The private equity industry is highly competitive, and BBU faces competition from other firms with similar strategies and resources. Increased competition could drive up acquisition prices and reduce the returns on BBU's investments. The company also faces competition from established players in the industries in which its portfolio companies operate.
Finally, regulatory risks are a concern. BBU's portfolio companies are subject to a variety of regulations, including environmental regulations, labor laws, and antitrust regulations. Changes in these regulations could increase the costs of doing business and reduce the profitability of BBU's investments. Furthermore, political instability or changes in government policies could negatively impact BBU's operations in certain countries.
Bulls Say / Bears Say
The Bull Case
BULL VIEWBBU's operational expertise and Brookfield Asset Management's backing allow it to consistently acquire and improve undervalued businesses, generating superior returns.
BULL VIEWThe low EV/EBITDA multiple and high free cash flow yield indicate that BBU is significantly undervalued, offering substantial upside potential.
BULL VIEWBBU's diversified portfolio across various sectors provides resilience against economic downturns in specific industries.
The Bear Case
BEAR VIEWBBU's high debt levels make it vulnerable to rising interest rates and economic recessions, potentially leading to financial distress.
BEAR VIEWThe volatile historical earnings and free cash flow make it difficult to predict future performance and justify a higher valuation.
BEAR VIEWThe cyclical nature of BBU's target industries exposes it to significant macroeconomic risks, limiting its ability to generate consistent returns.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score BBU and 4,400+ other equities.
Brookfield Business Partners L.P. exhibits a 83% valuation discount relative to institutional benchmarks. This represents a constructive entry window based on current multiples.
Return on Assets
Efficiency of asset utilization
4.7%
Sector: 3.3%
Gross Margin
Pricing power and cost efficiency
14.1%
Sector: 35.8%
Operating Margin
Core business profitability
7.2%
Sector: 6.2%
Net Margin
Bottom-line profitability
2.2%
Sector: 3.9%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
