Brookfield Infrastructure (BIP) AI Stock Analysis

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Brookfield Infrastructure

(NYSE:BIP)

54Neutral

Brookfield Infrastructure scores moderately due to its strong revenue growth and operational performance but is hampered by high leverage, negative free cash flow, and an extremely high P/E ratio suggesting overvaluation. The technical indicators point to a downward trend, adding to the concerns. The dividend yield is a positive aspect, offering some appeal to income investors.

Positive Factors

Financial Performance

Funds from Operations increased by 7.8% quarter over quarter and 3.9% year over year.

Growth Potential

Volume growth visibility suggests potential for future expansion.

Negative Factors

Tariff Risks

Tariff exposure presents significant risk, impacting the overall outlook.

Brookfield Infrastructure (BIP) vs. S&P 500 (SPY)

Market Cap

$17.64B

Dividend Yield6.09%

Average Volume (3M)660.29K

Price to Earnings (P/E)2505.6

Beta (1Y)1.34

Revenue Growth17.33%

EPS Growth-92.62%

CountryUS

Employees52,000

SectorUtilities

Sector Strength88

IndustryDiversified Utilities

Share Statistics

EPS (TTM)0.01

Shares Outstanding461,512,000

10 Day Avg. Volume663,121

30 Day Avg. Volume660,286

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.67

Price to Cash Flow (P/CF)3.10

P/FCF Ratio18.80

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$43.50

Price Target Upside61.17% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering6

Brookfield Infrastructure Business Overview & Revenue Model

Company DescriptionBrookfield Infrastructure Partners (BIP) is a leading global infrastructure company that owns and operates a diverse portfolio of high-quality infrastructure assets across various sectors including utilities, transport, energy, and data infrastructure. The company focuses on long-life, high-quality assets that generate stable cash flows and have significant barriers to entry. BIP's core services include the ownership and management of infrastructure assets that provide essential services to both public and private sector clients around the world.

How the Company Makes MoneyBrookfield Infrastructure primarily makes money through the ownership and operation of infrastructure assets that generate stable, long-term cash flows. The company's revenue model is based on several key streams: regulated and contracted revenue from utilities, transportation infrastructure such as toll roads and ports, energy infrastructure including pipelines and storage facilities, and data infrastructure assets like telecom towers and data centers. BIP benefits from long-term contracts and regulatory frameworks that provide predictable cash flows, often indexed to inflation, ensuring revenue stability. Additionally, Brookfield Infrastructure may engage in strategic partnerships and joint ventures to enhance asset value and expand its portfolio, further contributing to its earnings. The company's global diversification and focus on essential services provide resilience against economic fluctuations and support consistent financial performance.

Brookfield Infrastructure Financial Statement Overview

Summary

Brookfield Infrastructure has shown strong revenue growth and operational performance. However, it faces challenges due to high leverage and recent negative free cash flow, which may impact its financial stability.

Income Statement

Positive

Brookfield Infrastructure has shown significant revenue growth over the years, with a notable increase from $6.6 billion in 2019 to $21.0 billion in 2024. Despite this, net income has been volatile, with a sharp decline in 2024. The gross profit margin has been relatively stable, around 25% in 2024. The EBIT and EBITDA margins have been healthy, indicating strong operational performance, but the net profit margin is quite low, suggesting high interest or tax expenses.

Balance Sheet

Positive

The company has a high debt-to-equity ratio, indicative of significant leverage, which is typical for the utilities industry but poses financial risk. The equity ratio has been declining, pointing to increased liabilities relative to assets. Return on equity has also decreased significantly in 2024 due to lower net income. Overall, the balance sheet reflects robust asset growth but also rising debt levels, which could affect financial flexibility.

Cash Flow

Positive

Operating cash flow has grown steadily, but free cash flow turned negative in 2024 due to substantial capital expenditures. The operating cash flow to net income ratio is strong, indicating effective cash generation from operations. However, the negative free cash flow poses a concern for covering future investments without additional debt.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
21.04B	17.93B	14.43B	11.54B	8.88B
	Gross Profit
5.36B	4.46B	3.92B	3.29B	4.04B
	EBIT
4.96B	4.05B	3.59B	4.72B	2.39B
	EBITDA
8.60B	7.02B	5.94B	6.75B	3.95B
	Net Income Common Stockholders
57.00M	367.00M	1.38B	2.72B	904.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.07B	2.44B	1.28B	1.41B	867.00M
	Total Assets
104.59B	100.78B	72.97B	73.96B	61.33B
	Total Debt
51.09B	49.57B	33.80B	29.25B	23.18B
	Net Debt
49.02B	47.93B	32.52B	27.85B	22.31B
	Total Liabilities
74.74B	66.77B	47.41B	47.57B	39.66B
	Stockholders Equity
5.62B	6.24B	25.55B	26.39B	21.67B
Cash Flow		Free Cash Flow
-322.00M	1.59B	397.00M	790.00M	1.10B
	Operating Cash Flow
4.65B	4.08B	3.13B	2.77B	2.53B
	Investing Cash Flow
-6.90B	-12.99B	-3.37B	-1.17B	-4.61B
	Financing Cash Flow
2.61B	9.42B	56.00M	-995.00M	2.13B

Brookfield Infrastructure Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price26.99

Price Trends

50DMA

30.55

Negative

100DMA

31.54

Negative

200DMA

31.41

Negative

Market Momentum

MACD

-0.21

Negative

RSI

53.23

Neutral

STOCH

73.26

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BIP, the sentiment is Neutral. The current price of 26.99 is below the 20-day moving average (MA) of 29.07, below the 50-day MA of 30.55, and below the 200-day MA of 31.41, indicating a neutral trend. The MACD of -0.21 indicates Negative momentum. The RSI at 53.23 is Neutral, neither overbought nor oversold. The STOCH value of 73.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for BIP.

Brookfield Infrastructure Risk Analysis

Brookfield Infrastructure disclosed 88 risk factors in its most recent earnings report. Brookfield Infrastructure reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Brookfield Infrastructure Peers Comparison

Overall Rating

UnderperformOutperform

Sector (65)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CIG	80 Outperform	$5.39B	3.58	28.91%	11.61%	3.39%	46.79%
ELP	77 Outperform	$4.98B	2.24	9.47%	3.15%	-4.45%	―
BKH	72 Outperform	$4.18B	14.84	8.13%	4.63%	-8.73%	0.14%
Sector *	65 Neutral	$11.76B	15.57	6.23%	4.62%	5.52%	-8.96%
SRE	64 Neutral	$41.66B	14.47	9.55%	3.93%	-18.00%	-7.54%
AES	59 Neutral	$7.61B	4.52	39.65%	6.78%	-3.14%	563.59%
BIP	54 Neutral	$17.64B	2,505.56	0.96%	6.09%	17.33%	-92.62%

* Utilities Sector Average

Performance Comparison

BIP

Brookfield Infrastructure

29.36

3.08

11.72%

BKH

Black Hills

57.99

7.98

15.96%

CIG

Companhia Energetica Minas Gerais

1.69

-0.05

-2.87%

ELP

Companhia Paranaense de Energia Pfd

7.31

0.05

0.69%

SRE

Sempra Energy

68.06

0.06

0.09%

AES

11.14

-5.75

-34.04%

Brookfield Infrastructure Earnings Call Summary

Earnings Call Date: Jan 30, 2025 | % Change Since: -14.86% | Next Earnings Date: Apr 30, 2025

Earnings Call Sentiment Positive

The earnings call presented a generally positive outlook with strong financial performance and strategic achievements, particularly in the Transport and Data segments. However, challenges in the Midstream segment and foreign exchange impacts were noted as areas of concern.

Highlights

Strong Financial Performance

Brookfield Infrastructure reported a 7% increase in funds from operations (FFO) to $599 million for Q3 2024, driven by new investments and organic growth.

Transport Segment Growth

The Transport segment achieved a notable 50% increase in FFO, attributed to acquisitions and strong volume growth across networks.

Data Segment Expansion

Data segment FFO increased by 29% over the previous year, supported by new investments and the commissioning of additional capacity in the U.S. and Europe.

Capital Markets Success

Completed $3 billion in non-recourse financings, extending maturities and reducing costs, including a significant reduction in interest expenses through refinancing efforts.

Acquisition in India

Closed the acquisition of 76,000 Indian telecom tower sites, making Brookfield the largest telecom tower operator in India and second largest globally.

Capital Recycling Achievements

Secured $600 million in capital recycling proceeds in the quarter, achieving a total of $2 billion for the year.

Lowlights

Midstream Segment Decline

The Midstream segment saw a decrease in FFO to $147 million from $163 million due to capital recycling activities and higher interest costs.

Impact of Foreign Exchange

Results were partially offset by higher borrowing costs and foreign exchange impacts, notably the depreciation of the Brazilian Reais.

Company Guidance

In the third quarter of 2024, Brookfield Infrastructure Partners reported funds from operations (FFO) of $599 million, marking a 7% increase from the previous year, bolstered by new investments and organic growth. The Utilities segment achieved an FFO of $188 million, driven by inflation indexation and a $450 million capital commissioning. The Transport segment saw a significant 50% FFO increase to $308 million, owing to strategic acquisitions and strong volume growth. Meanwhile, the Midstream segment's FFO decreased to $147 million due to past capital recycling and higher interest costs, yet the underlying business remained robust. The Data segment excelled with a 29% FFO increase, reaching $85 million, supported by new investments like the acquisition of retail colocation data centers. The company also reinforced its capital strategy by completing $3 billion in nonrecourse financings, enhancing liquidity to $4.6 billion, and maintaining a strong balance sheet with no corporate debt maturities until 2027.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.