I have initiated a small position in & BIP
Diversified asset base
The partnership owns a strong and diversified portfolio of assets, including utilities, transportation, energy, and communications infrastructure across North and South America, Asia Pacific, and Europe.
This portfolio of critical infrastructure assets globally provides long-term investors nice diversification and helps the company generate stable cash flows with minimal maintenance capital expenditures.
Its assets range from electricity and gas distribution businesses in Australia and the U.S., railroads in South America, and a portfolio of 36 ports in North America, Asia Pacific, the U.K., and across Europe.
As global customers use these critical assets, Brookfield gets paid a utilization fee, which generates stable cash flow. The company distributes the most of its cash flow among shareholders in dividends.
Strong capital gains
Investors who bought Brookfield Infrastructure units in 2009, when it started trading, have seen the value of their units surge more than three times — a return of 347%.
On a total-returns basis, the company has delivered a 27% return on annualized basis, far exceeding many of its peers. The company has been able to produce superior returns because its businesses generally operate under regulated or contractual frameworks that provide sustainable cash flows.
Because the company’s assets are diversified by sector and geography, its portfolio’s exposure to any single counterparty, regulatory regime, or market fluctuation is reduced.
In the recent quarter, the growth in the company’s cash flows has been led by a strong and growing utility segment. Funds from operations from utilities surged 68% from the same period a year ago to $168 million.
The current equity offering suggests that the company is still in growth mode, as the management indicated in its press release: “Brookfield Infrastructure intends to use the net proceeds … to fund a growing backlog of committed organic growth capital expenditure projects, an active pipeline of new investment opportunities and for general working capital purposes.”
Brookfield Infrastructure has been a great dividend-growth stock. With a current dividend yield of 3.4%, Brookfield pays a quarterly payout of $0.435 a share.
The company targets annual growth of 5-9% in its dividend, but the actual growth of 12% has far exceeded its distribution target.
I have initiated a small position in BAM STOCK
diversification of assets
Dividend more than doubled since 2009 & stock is over 400% in capital appreciation, yes you can find better but with this type of stable business I am satisfied with the performance. Dividend growth at a healthy averaged 7.8% per annum.