BIPC - 2 Bargain-Basement Stocks to Buy Now to Make You Richer
2023-06-20 10:32:59 ET
Many factors can cause a company to trade at a relatively lower valuation. It might have balance sheet issues, lack growth prospects, or have a more complex corporate structure.
That last issue seems to be the driving factor behind the low valuations of Brookfield Infrastructure Partners (NYSE: BIP) and Energy Transfer (NYSE: ET) . They're both publicly traded limited partnerships . Those entities have some tax complexities, which tend to weigh on their valuations compared to traditional corporations. However, those lower valuations enable investors to lock in a higher income yield, which can make them richer over time.
Brookfield Infrastructure Partners currently trades at around $35.50 per unit. That's a more than $10 discount from the recent trading price of its corporate twin, Brookfield Infrastructure (NYSE: BIPC) . It's a confounding discount, since the economically equivalent companies have the same earnings ($0.72 of FFO per unit/share in the first quarter, or $2.88 per unit/share annualized) and dividend payment ($0.3825 per unit/share each quarter or $1.53 per unit/share annually).
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2 Bargain-Basement Stocks to Buy Now to Make You Richer