3 Reasons Brookfield Corporation Could Be a Top Financial Stock for the Next Decade

Brookfield Corporation (NYSE: BN) has arguably been one of the best financial stocks over the past 30 years. The global investment firm has delivered a 19% annualized total return over the last three decades, crushing the S&P 500's 11% annualized total return. Brookfield has achieved robust returns by evolving its business and continuing to innovate.

The alternative investment giant believes the best is yet to come. Here are three reasons why it could be the top financial stock to buy and hold for the next decade.

Image source: The Motley Fool.

Investing heavily in AI infrastructure

One of the keys to Brookfield's success over the years is its thematic investment approach. It aims to identify secular trends, create products that serve its clients based on those megatrends, and then deploy capital at scale into those themes.

Brookfield Corporation believes that AI could become the most impactful general-purpose technology in history if the global economy builds out the necessary infrastructure to support its adoption. The company estimates that total AI infrastructure spending could reach $7 trillion over the next decade. It aims to be a leader in investing in this once-in-a-generation opportunity.

The global financial firm launched its inaugural Brookfield AI Infrastructure Fund late last year, aiming to acquire up to $100 billion in AI infrastructure assets. It's a cornerstone investor in the fund. Additionally, Brookfield's operating businesses are all investing in AI infrastructure, including building AI factories, developing power solutions, and establishing new platforms to help companies deploy AI.

Robust demand for wealth solutions

The retirement financial model has shifted over the years from pensions to defined contribution plans. That's creating a structural need for new wealth solutions to provide future retirees with sustainable income.

Brookfield sees a massive opportunity to provide individual investors with wealth solutions to support their retirement. They hold an estimated $40 trillion in assets, nearly double the size of the institutional investor market. The company believes that individual investors will steadily allocate more capital to alternative investment strategies, including annuities, going forward.

This trend drove the company to build a large-scale wealth solutions platform over the past several years to capitalize on growing demand for wealth protection products such as annuities. Brookfield is also creating new investment products geared toward individual investors.

Capitalizing on the real estate recovery

Brookfield Corporation is one of the world's largest real estate investors. It manages $277 billion in real estate assets. The company owns 100% of Brookfield Property Group, a leading owner of high-quality office and mall properties. Additionally, its asset management arm manages several real estate funds.

The global real estate market has been challenging over the past several years due to structural changes (lower post-pandemic demand for office space) and higher interest rates. However, operating fundamentals across most real estate sectors are strengthening. Meanwhile, interest rates are declining from their peaks. That drives Brookfield's view that the global real estate market is starting to recover.

The company has taken a counter-cyclical approach to real estate investing, leaning into the sector during a period when others pulled back. It has deployed $60 billion of capital into real estate over the last five years, putting it in an even stronger position to capitalize on the recovery phase.

Strong growth for a value price

Brookfield currently estimates the company is worth about $68 per share. That's well above its recent trading price of less than $45 per share. The company believes its multiple growth catalysts will drive annual earnings-per-share growth of around 25% for at least the next five years. That would increase its per-share value to $140 by 2030. The company's combination of robust growth and low valuation positions investors to generate strong total returns over the next decade, making it a top financial stock to buy and hold.

Matt DiLallo has positions in Brookfield Corporation and has the following options: short July 2026 $40 puts on Brookfield Corporation. The Motley Fool has positions in and recommends Brookfield Corporation. The Motley Fool has a disclosure policy.