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Brookfield Infrastructure Offers Investors A 5% Dividend Yield And 13% Discount To Intrinsic Value

Brookfield Infrastructure Partners (NYSE:BIP) recently announced it increased its dividend distribution by 10%. Although it was lower than our previous single year dividend growth in 2015, it was higher than our previous 7% estimated long-term dividend growth rate. BIP's dividend increased by 13% annually since its 2008 IPO and BIP expects its long-run dividend growth rate will be 5%-9%. We believe that future dividend growth will be closer to the higher end of its forecasted range as it offers strong, steadily growing cash flow funds from its operations, which enables BIP to provide investors with strong dividend yields and dividend growth. BIP offers investors a 5% dividend yield and we believe its share price is 13% undervalued relative to its fair intrinsic value. For these reasons, we reiterate investors accumulate shares in BIP, especially income-oriented investors as BIP continues its consistent performance