Market Overview

Brookfield Infrastructure: An Underappreciated Stock, With Robust Growth And Numerous Catalysts

Brookfield Infrastructure: An Underappreciated Stock, With Robust Growth And Numerous Catalysts

Brookfield Infrastructure Partners L.P. (NYSE: BIP) is an underappreciated stock with a strong growth story, at least according to analysts at BMO Capital Markets. The firm's Devin Dodge initiated coverage of Brookfield's stock with an Outperform rating and $48 price target.

One of the most compelling aspects of Brookfield's business is its combination of $2.5 billion in backlog and a series of recently completed acquisitions, Dodge commented in a note. These factors will help Brookfield's FFO/unit growth to exceed its own target of 10 percent over the next three years. On top of that, the company is pursuing various projects that could add an incremental $1.5 to $2.0 billion to its existing capital backlog over the next year.

The infrastructure company is also in the process of divesting up to $2 billion worth of mature assets over the next two years; This provides new opportunities for the company to optimize the capital structure of investments that could free up more capital, the analyst noted. This will also help increase the company's payout ratio (based on FFO) to increase at a compounded annual growth rate of 11 percent through 2019, which also happens to be above the company's own targeted growth range of 5 to 9 percent.

Brookfield's stock will be added to the S&P/TSX Composite index later this month and the stock is also a "strong candidate" to be added to the TSX 60 index in the future.

Bottom line, based on an encouraging outlook for FFO/unit and distribution growth, the stock's valuation at current levels is "attractive" and is in fact trading at a 3 percent discount to its historical average P/AFFO multiple with a yield of 4 percent.

Related Link:

Your Easy Guide To Credit Suisse's New Top Stocks List

Latest Ratings for BIP

Feb 2020TD SecuritiesDowngradesBuyHold
Dec 2019Bank of AmericaReinstatesBuy
Sep 2019BarclaysMaintainsEqual-Weight

View More Analyst Ratings for BIP
View the Latest Analyst Ratings

Posted-In: Brookfield Infrastructure infrastructureAnalyst Color Price Target Initiation Analyst Ratings Best of Benzinga


Related Articles (BIP)

View Comments and Join the Discussion!

Latest Ratings

LOWPiper SandlerReiterates147.0
EIDXPiper SandlerReiterates80.0
SSYSPiper SandlerMaintains24.0
ALEXPiper SandlerMaintains22.0
IONSPiper SandlerMaintains65.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at