What’s Going on With Brookfield Renewable Partners?

Despite underperforming the market in the last few years, Brookfield Renewable Partners remains a solid stock for investors, particularly those seeking income.

Kay Ng

Kay began investing in dividend stocks around 2008 via the concept of value investing. Since then, she has expanded into growth investing, including in small caps. Her passion for investing has only grown over the years! After graduating from UBC with a BSc in Computer Science, she took university courses in financial markets, finance, and financial accounting. She has contributed her works to Motley Fool, Sure Dividend, and Seeking Alpha.

Published September 25, 2025 9:00 pm EDT

| More on: BEP.UN

Key Points

Brookfield Renewable Partners (BEP.UN) has materially underperformed the Canadian market since early 2022 (‑5.4% return vs. the market's 55.7%), even as it fared better than major clean‑energy ETFs and remained flat after mid‑2024 while the TSX surged.
However, the business remains fundamentally strong — 43,300 MW of assets, a 180,500 MW development pipeline, ~70% inflation‑indexed revenue, a BBB+ balance sheet, a 5.7% distribution yield, and management guidance for 5-9% annual distribution growth — making it a potential long‑term income play.
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Brookfield Renewable Partners (TSX:BEP.UN) has long been considered a blue-chip play in the renewable energy space — but lately, investors are asking: what’s going on with this underperforming stock?

Despite its impressive portfolio and consistent growth strategy, BEP.UN has lagged behind the broader Canadian stock market by a wide margin in recent years, raising questions about its role in investor portfolios.

Confused person shrugging — Source: Getty Images

A market laggard in a hot market

Since the Bank of Canada began its last interest rate hiking cycle in early 2022, BEP.UN has delivered a total return of approximately -5.4%, while iShares S&P/TSX 60 Index ETF — a benchmark for the Canadian market — has returned a stunning 55.7%.

Even when compared to its clean energy peers, BEP.UN hasn’t exactly shone — but it’s done better than most. Over the same period, three major clean energy exchange-traded funds (ETFs) — iShares Global Clean Energy Index ETF, Harvest Clean Energy ETF, and BMO Clean Energy Index ETF — posted an average return of -13.8%. So, while BEP.UN hasn’t kept pace with the broader market, it remains one of the more resilient names in its sector.

After the Bank of Canada began cutting rates in mid-2024, sentiment toward renewables improved slightly. The average return from those clean energy ETFs turned positive at 3.1%, while BEP.UN was flat — and the Canadian market surged 38%. That divergence raises eyebrows: is BEP.UN still worth holding?

A strong business behind the stock

Despite market underperformance, Brookfield Renewable’s operations continue to grow. The company owns and operates a massive 43,300 MW of renewable and transition assets spread across five continents, diversified across hydro (19%), wind (39%), utility-scale solar (27%), and distributed energy and storage (15%).

Its development pipeline of 180,500 MW is heavily weighted toward solar (71%) and onshore wind (23%), pointing to long-term demand for clean energy infrastructure. Its assets are not just large — they’re high quality. About 70% of its revenues are indexed to inflation, and 90% are contracted with long-term agreements averaging 14 years.

The company’s financials are solid. Brookfield Renewable boasts a BBB+ investment-grade balance sheet, with 97% of its debt at fixed rates, averaging 12 years to maturity. This structure helps shield the business from short-term interest rate volatility.

In the first half of 2025, Brookfield reported 8.0% FFO (funds from operations) growth, with FFO per unit up 8.3% to US$1.04. Its FFO payout ratio sits at an acceptable 72%, supporting its cash distributions.

A long-term play for income investors

At under $36 per unit, BEP.UN offers a compelling 5.7% cash distribution yield. Analysts currently see the stock trading at a 12% discount, implying potential near-term upside of around 14%. More importantly for long-term investors, the company has raised its payout consistently for 15 years, with a compound growth rate of 6.1%.

Looking ahead, management expects to grow FFO enough to support 5-9% annual distribution increases, keeping BEP.UN is attractive for income-focused investors.

Investor takeaway

Brookfield Renewable Partners may not be exciting on the charts right now, but the business remains fundamentally strong. For long-term investors — especially those seeking income and exposure to renewable infrastructure — buying on weakness could prove a smart move as the energy transition continues to unfold.