Reported 7 months ago
The P/E ratios of the infrastructure industry are still low, making it a great time to invest at a value price according to fund managers. These stocks have shown a significant rebound this year, with P/E ratios remaining below the long-term average by over a standard deviation. Infrastructure companies often have stable cash flows thanks to operating rights and long-term contracts, providing better dividend yields than global stocks. With the Federal Reserve potentially lowering interest rates in the second half of the year, infrastructure stocks are expected to perform well. Statistics show that investing in infrastructure stocks when the P/E ratio is more than one standard deviation below the 10-year average since 2014 has yielded positive returns over various time frames, with longer holds increasing return probabilities and rates. Post-pandemic, the demand for infrastructure, especially in transportation, is expected to surge, benefiting sectors such as airports, railways, and toll roads.
Source: YAHOO