Brookfield Infrastructure: Undervalued Income Growth Story Poised for Double-Digit FFO Recovery and Capital Recycling-Driven Upside

Analyst Devin Dodge of BMO Capital maintained a Buy rating on Brookfield Infrastructure, retaining the price target of $43.00.

Devin Dodge has given his Buy rating due to a combination of factors that point to a stronger growth and return profile for Brookfield Infrastructure over the medium term. He expects funds-from-operations per unit to return to low double-digit growth from 2026 onward as prior headwinds from foreign exchange, higher interest rates, and portfolio mix gradually subside, allowing the company’s underlying earnings power to show through. In addition, the current valuation multiple sits meaningfully below historical norms, while units offer an attractive ~5% yield, making the risk‑reward compelling for income‑oriented investors.

Dodge also highlights the strength of Brookfield Infrastructure’s capital recycling engine as a key support for future growth. The company has already executed a record level of asset sales and is targeting a further ~$3 billion of monetizations over the next 12–18 months to help fund its growth pipeline. He projects a 6% annual distribution increase through 2028, with room for faster growth given the expected decline in the payout ratio toward the low end of management’s target range. Finally, the strategy of issuing BIPC shares through an at-the-market program and using proceeds to repurchase BIP units should help narrow the price gap between the two securities and enhance overall equity value, reinforcing the Buy recommendation.