Thank you, ultimatespinach. I think I may be finally starting to get my head around where the value lies (pun intended).

I updated bjlkeng's conservative Q2 estimate for the value of the old BAM using Q3 data. BJlkeng's value estimate was posted on The Motley Fool Brookfield Asset Management discussion board on August 16th.

discussion.fool.com - Conservative valuation

Bjlkeng got a value/share of $45.37, or a total value of $74.4B. $36.9B was the net value of the invested capital using IFRS figures. $37.5B was the value of the fee related earnings (FRE) and the 5-year average net carried interest, both valued at a multiple of 15x. Updating the numbers using BAM's supplemental data for Q3, I get a value of $45.35 per share, or $74.3B total value. $35.7B is the net value of the invested capital using IFRS figures. $38.7B was the value of the fee related earnings (15*$2.031B) plus the 5-year average net carried interest (I used bjlkeng's Q2 value for the 5-year average net carried interest).

If I did my algebra right (big if), then post-split BN should be worth 1x the invested capital plus 0.75x the value of the FRE plus carried interest, or $35.7B + 0.75*$38.7B = $64B, as compared to a market cap as of 12/16/22 of $53.2B. That would imply that BN is about 18% undervalued. The new BAM should be worth the value of the FRE and the carried interest, or $38.7B, as compared to a market cap as of 12/16/22 of $44.6B. That would imply that BAM is about 15% overvalued.

I don't doubt that fee related earnings will grow faster than net invested capital, which one could argue makes BAM the better investment compared to BAM. However, BN appears to be cheaper relative to fair value than BAM, and BN is the boss. BN decides the strategy, the investments and the fees, and they also own 75% of BAM.

I look forward to seeing the value estimates of other board members who know BN and BAM much better than I do.