Units of Brookfield Renewable Partners (BEP -1.07%) have been red-hot this year, surging more than 30%. As a result, the renewable energy company isn't quite as attractive an investment as it was to start the year since its valuation isn't as cheap while the yield isn't as high.

However, that doesn't mean it isn't still a worthwhile stock to buy these days. Here's a look at what it offers investors.

A field of solar panels with wind turbines in the background at dawn.

Image source: Getty Images.

It's still an attractive income stock

The main reason most investors would consider buying Brookfield Renewable Partners is its high-yielding dividend. At 5.8%, it's still well above average, making it an attractive option for income-seeking investors.

Furthermore, the payout is on an increasingly sustainable footing. For starters, Brookfield Renewable has long-term, fixed-price contracts in place to sell the bulk of the power it produces, which currently locks in about 87% of its cash flow. On top of that, the company has a top-notch balance sheet. The only concern is that its dividend payout ratio over the past year was a bit high at around 90% of its cash flow, which is well above its 70% target ratio. However, that number has been improving thanks to the company's efforts to increase its cash flow.

The growth prospects continue to look compelling

While Brookfield Renewable Partners is mainly an income story, that doesn't mean it lacks growth. Currently, the renewable energy giant believes its cash flow per unit will grow at a 6% to 11% annual pace over the next five years. Two factors power that forecast. First, it thinks it can increase the earnings of its existing assets by a 3% to 6% annual rate through a combination of cost reduction efforts and initiatives to increase cash flow, such as signing higher-rate contracts when legacy ones roll off. Brookfield believes it can boost its annual earnings total by another 3% to 5% by investing in high-return renewable expansion projects, such as building new wind farms, solar projects, hydro facilities, and energy storage assets. This organic growth alone should enable it to increase its high-yielding distribution at a 5% to 9% yearly pace.

In addition to its attractive organic growth profile, Brookfield Renewable has an excellent track record of making accretive investments and acquisitions. Its most recent deal was a 750 million Canadian dollar ($568 million) investment in utility TransAlta (TAC 4.86%). The company will initially earn a fixed 7% rate on its investment in TransAlta. However, it can eventually convert this into a direct interest in TransAlta's hydroelectric assets in Canada. Brookfield's ability to continue finding compelling outside investment opportunities will enable it to grow its cash flow at an even faster rate in the future.

The valuation still looks reasonable

Brookfield Renewable's unit price has bounced back sharply this year, powered in part by its strong quarterly results. Overall, units have surged more than 30% this year and currently trade at around $34 apiece. With the company generating $2.27 per unit of cash flow over the past 12 months, it implies that Brookfield Renewable sells for about 15 times cash flow. That's a reasonable valuation for a company that boasts a strong financial profile and healthy growth prospects.

Verdict: Brookfield Renewable Partners is a buy

Brookfield Renewable Partners checks all the boxes for investors. The company pays an attractive dividend, has compelling growth prospects, has a sound financial profile, and trades at a reasonable valuation. Consequently, it should be able to produce market-beating total returns over the next several years. That above-average upside potential makes it an ideal stock to buy for the long term.