Brookfield Infrastructure Partners (BIP.UN.TO)

Sensitive to interest rates. Big projects with a lot of debts associated to them become less attractive when rates go up. Probably one of Canada’s best ran companies. He wouldn’t bet against it.

Really appreciate the way they go about their business. They own great returns and have been great capital allocators. They typically find great opportunities when they find distressed sellers or unique assets to buy. Sold out their holding in the last month or so given the valuation they’ve seen. As had a great run and doubled in the last number of years. (Analysts’ price target $46.64.)

Brookfield does a great job of buying and selling things, and actively managing an infrastructure portfolio. He likes it. Right now, this is slightly expensive, based on its cash flows. Prefers Brookfield Business Partners (BBU.UN-T), a pure private equity group with a $2 billion market cap.

A very solid investment. They’ve done a great job.

Which Brookfield subsidiary would you recommend for a 4-5 year hold? If you like dividends while waiting, this is one he would recommend.

Of all the Brookfield spinoffs, this has been one of the best. It has all kinds of infrastructures such as utilities, timber, transportation, energy, communications, water. Funds from Operations is growing at 20% per year. This is the kind of stock everybody should own. Dividend yield of 4%. (Analysts’ price target is $47.)

We have aging infrastructure globally, and a lot of governments will probably have to sell existing assets to be able to finance new assets. That puts attractive assets into the pool. This is one of the few companies with access to a lot of capital. The company has expanded geographically and have acquired expertise, so their assets now are much more broadly located, such as in Asia and India. She likes the geographic mix for a Canadian company. (Analysts' price target is $47.)

A good broad way to play infrastructure. He owns some of the preferreds (K) but it is different that holding the coming. He prefers one of his Top Picks today. Hold if you own it.

It is a well managed group of companies but he is not in this sector. He would look for 10% total return to go into the sector. This one is very well managed and he does not have anything against the companies but is not participating in the sector.

Since this went public it has had something like a 20% compound total return. The whole Brookfield group is such a great well-run business. What they’ve been able to do, which no one else has been able to do, is to have a long-term plan and strike when the iron is hot and acquire distressed assets. Recently did a big equity deal, and assumes they have a lot of deals they are working on. Dividend yield of 4.3%.

Inter Pipeline (IPL-T) or Brookfield Infrastructure Partners (BIP.UN-T)? She would encourage Canadians to look outside of Canada, so Brookfield Infrastructure would probably offer more opportunities. Also, there is not as much exposure to crude oil prices as Inter Pipeline would have.

(A Top Pick Sept 21/16. Up 28%.) Just did an equity issue because of a huge backlog of projects, about $2.5 billion. If he had to pick one stock to own over the next number of years, it would be this. They increased their dividend over 10% for the last 8 years, and expects they will continue to do that. The #1 infrastructure stock globally. Dividend yield of 4.1%.

There has been a bit of a pullback. The rationale for a pullback is hard to determine. It might be that people are thinking some of their projects are going to be pushed a little further out. He wouldn’t be concerned about the pullback. If playing this for the dividend, infrastructure is a good place to be. On a macro level, he prefers the more diversified asset management company. Dividend yield of about 5%.

Doesn’t follow this company to closely, but does like the infrastructure space. It’s a good way to diversify your assets on the equity side, and you are still getting a real asset focus. Has no issue with this.

Infrastructure is the buzzword of every western government on the planet. What happens when they financed new infrastructure, they have to sell something. Nobody has a budget for new infrastructure. That is when this company comes in. They are capable of joint venturing with someone and can buy fairly chunky assets. Dividend yield of 4.7%. (Analysts’ price target is $42.)