Why Brookfield Renewable Corporation (TSE:BEPC) Could Be Worth Watching

Let's talk about the popular Brookfield Renewable Corporation (TSE:BEPC). The company's shares saw significant share price movement during recent months on the TSX, rising to highs of CA$43.66 and falling to the lows of CA$37.29. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Brookfield Renewable's current trading price of CA$37.52 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Brookfield Renewable’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Brookfield Renewable

What's The Opportunity In Brookfield Renewable?

Great news for investors – Brookfield Renewable is still trading at a fairly cheap price. Our valuation model shows that the intrinsic value for the stock is CA$54.93, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. What’s more interesting is that, Brookfield Renewable’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.

What kind of growth will Brookfield Renewable generate?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Though in the case of Brookfield Renewable, it is expected to deliver a highly negative earnings growth in the next few years, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.

What This Means For You

Are you a shareholder? Although BEPC is currently undervalued, the negative outlook does bring on some uncertainty, which equates to higher risk. We recommend you think about whether you want to increase your portfolio exposure to BEPC, or whether diversifying into another stock may be a better move for your total risk and return.

Are you a potential investor? If you’ve been keeping an eye on BEPC for a while, but hesitant on making the leap, we recommend you research further into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future.

If you'd like to know more about Brookfield Renewable as a business, it's important to be aware of any risks it's facing. Every company has risks, and we've spotted 4 warning signs for Brookfield Renewable (of which 2 make us uncomfortable!) you should know about.

If you are no longer interested in Brookfield Renewable, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.