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Credit Suisse Bullish On Brookfield Infrastructure

Credit Suisse has reinstated its coverage on Brookfield Infrastructure Partners L.P. (NYSE: BIP) with an Outperform rating and $59 target price, saying that Street underestimates the underlying organic growth from Brookfield's existing asset base along with increasing network benefits.

Apart from abundant M&A opportunities, the brokerage said the company's evolution is a much more visible organic growth profile coming from existing assets.

"This maturation lessens the need for M&A and highlights BIP's increasing network benefits that should provide greater financial and valuation clarity," analyst Andrew Kuske wrote in a note.

Related Link: It's Been 29 Days Since The S&P Moved 1%

The analyst expects Brookfield to generate double-digit FFO growth over the next three years, and projected FFO growth translates into an average of 10 percent distribution growth.

Kuske's $59 target price is obtained, in part, on a NAV along with an implied 4.0 percent distribution yield (200bps spread on an assumed 2.00 percent U.S. 10-year bond yield).

Units of Brookfield closed Monday's regular trading at $48.87. The $59 price target represents a potential upside of about 21 percent.

Full ratings data available on Benzinga Pro.

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Latest Ratings for BIP

Aug 2016

Credit Suisse

Reinstates

Outperform

Mar 2016

TD Securities

Maintains

Buy

Feb 2016

TD Securities

Maintains

Buy

View More Analyst Ratings for BIP
View the Latest Analyst Ratings

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© 2016 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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