Is Brookfield Property Partners (BPY) a Smart Long-Term Buy?

Horos Asset Management, an asset management firm, published its ‘Horos Value Internacional’ fourth-quarter 2020 Investor Letter – a copy of which can be downloaded here. A return of 26.3% was recorded by the fund for the Q4 of 2020, outperforming its benchmark index that delivered an 11.9% return. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Horos Asset Management, in their Q4 2020 Investor Letter, said that they reduced their position in Brookfield Property Partners L.P. (NASDAQ: BPY) because of a recent takeover of the company. Brookfield Property Partners L.P. is a commercial real estate company that currently has a $16.1 billion market cap. For the past 3 months, BPY delivered a 14.50% return and settled at $17.48 per share at the closing of February 8th.

Here is what Horos Asset Management has to say about Brookfield Property Partners L.P. in their Q4 2020 investor letter:

“We trimmed our exposure to this real estate company, following the excellent performance of Brookfield Property Partners’ (“BPY”) stock during the period. This can be explained by several factors, including the share buybacks that the company has been executing in the second half of the year, as well as the improvement of the situation in the shopping centers owned by BPY in the United States, where rent collection has shown significant progress in recent months.

However, although outside the period covered by this letter, the most noteworthy event occurred on January 4 of this new year, with the announcement of Brookfield Asset Management (“BAM”)’s takeover bid for the remaining shares of BPY that it
does not control, at a price of 16.5 dollars per share (a premium of 14% over the December close). The price seems to us to be far below the valuation that, in our opinion, BPY deserves—e.g., its last reported NAV stands at 26.80 dollars—so we will hold the position, awaiting a potential increase in the offer price. In fact, on previous occasions, BAM has proceeded in this way.

Therefore, we find ourselves with another example of the attractive price at which the companies we hold in our portfolios are trading and how—in the case of family businesses or similar—the controlling shareholders are taking advantage of the situation to try to get hold of the rest of the shares they do not own. This always leaves a bittersweet feeling for us as shareholders, as the transaction is made at prices far below our target valuation (as in the case of Clear Media or Sonae Capital), but it helps to uncover the value of our investments more quickly.”


Last December, we published an article telling that Brookfield Property Partners L.P. (NASDAQ: BPY) was in 8 hedge fund portfolios. Its all time high statistics is 11. BPY delivered a 19.94% return YTD.

Our calculations show that Brookfield Property Partners L.P. (NASDAQ: BPY) does not belong in our list of the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website.

Disclosure: None. This article is originally published at Insider Monkey.