What happened
Shares of Brookfield Asset Management (BN 1.92%) surged as much as 13.8% by 2:45 p.m. ET on Thursday. The main factor driving up the giant alternative asset manager's share price was its strong third-quarter results.
So what
Brookfield Asset Management reported $1.2 billion of operating funds from operations (FFO) in the third quarter, a 30% increase from the prior-year period. The company benefited from the strength of its asset management business -- fee-related earnings increased 20% year over year to $531 million -- and its investments across private equity, real estate, infrastructure, and renewable energy.
Brookfield had an excellent quarter raising capital from investors. Inflows totaled $33 billion as it closed several new funds, including its fifth flagship infrastructure fund and sixth flagship private equity fund. Those inflows grew its fee-bearing capital to $407 billion, up 19% year over year.
The company continues to find attractive opportunities to put investor capital to work. Brookfield committed to $31 billion of new investments in the quarter. Notable deals included a funding partnership with semiconductor giant Intel to help finance half the $30 billion cost of building new chip factories in Arizona. Brookfield also formed a partnership to buy Deutsche Telekom's tower business in Germany, along with one with Cameco to own Westinghouse. These investments set the stage for future investment returns and growth.
Now what
Brookfield Asset Management continues to benefit from the steady shift of investor capital from the public stock and bond markets into alternative investments. That's growing the company's fee-bearing capital while enabling it to complete larger deals. That trend should allow Brookfield to continue producing market-beating total returns in the coming years.
