布鲁克菲尔德基建公司

Brookfield Infrastructure Corp is assigned a 5-star quantitative star rating, indicating our belief that this share class offers a compelling opportunity for investors. The stock currently trades at a 27% discount to our quantitative fair value estimate of $49.56 per share; however, some caution is warranted due to this estimate's medium uncertainty rating.

The firm's valuation metrics bolster our estimated fair value. A company's valuation metrics provide insights into the market's expectations for its future growth and profitability. For example, the firm's enterprise value to EBITDA ratio of 6.8 ranks in the bottom 30% compared with global peers. Relative to the company's EBITDA, the enterprise value of the business is low, which contributes to our view that shares are undervalued.

The firm's balance sheet is an additional encouraging factor. Leverage can enable a company to invest in growth, potentially boosting shareholder value more than equity financing alone. The firm's EBITDA/interest coverage ratio of 2.1, for example, ranks in the bottom 20% globally. Although the firm's ability to cover interest payments with EBITDA is limited, shares could sharply rebound if economic circumstances change or recent investments reduce fears of default. This characteristic further promotes our favorable price/fair value ratio.

With its quantitative economic moat rating of none, this business is unlikely to consistently outearn its cost of capital without structural protection from competition. Additionally, the firm's moderate financial health score suggests it is acceptably positioned against adverse economic circumstances.