Global Infrastructure stocks offer massive upside
Robert Crimes remains bullish on the Infrastructure sector, citing strong long-term traffic growth, resilient IRRs (averaging 11.3%, +290bps above Insight’s 8.5% Ke) and deep value in listed equities trading ~40% below NAV, despite private market transactions averaging just -3% below NAV over the past decade. The sector shows a weighted average upside of +78%, with notably higher upside in North America (+102%) and Europe (+73%) versus South America (-5%). Credit risk is not a concern, as leverage is manageable, bond yields have plateaued after a sharp 2022 rise and most debt remains fixed at low rates with long durations. Robert's top picks are Ferrovial, Canadian National Railway and Cellnex, each offering over +110% upside.
Edition: 214
- 27 June, 2025
Infrastructure stocks offer huge upside
Industrials
The companies covered by Insight offer an average upside of 90%. Their top 3 names are: 1) Ferrovial (TP €82) - US Managed Lanes EBITDA growing rapidly on good transactions growth and excellent toll increases. 2) Canadian National Railway (TP C$354) - mostly unregulated pricing and limited cyclicality of EBITDA. Strong recurring FCF growth, High ROIC and shareholder remuneration to grow at >6% CAGR to 2050E. 3) Cellnex (TP €75) - pan European tower platform with strong market positions and inflation linked contracts. Paused acquisition strategy will see rapid deleverage, stronger grade credit rating, then enhanced shareholder remuneration.
Edition: 197
- 18 October, 2024
Industrials
Robert Crimes initiates coverage with a Buy rating and TP of $384 (100% upside) - this follows Insight’s recent work on CN Rail (TP C$341, +120%) and CPKC (TP C$218, +108%). Railroads is now their preferred Infrastructure sub-sector, which is set to benefit from the “New Golden Age of Rail” driven by favourable environmental credentials and increasing cost advantage vs. road. While UNP has underperformed its peers regarding network fluidity, volumes, EBITDA growth and safety, Robert expects its new CEO to improve performance.
As infrastructure specialists, Insight focuses on lifetime free cash flows with detailed DCFs / DDMs and IRR-Ke valuations. Their CN Rail initiation report from earlier this year provides a useful example of a 'typical' Insight report and can be accessed by clicking here.
Edition: 161
- 26 May, 2023
Canadian National Railway (CNR CN) Canada
Industrials
Reliable demand, strong unregulated pricing, high capital barriers and excellent returns - Robert Crimes initiates coverage with a Buy rating and TP of C$360 (100%+ upside). Insight’s key value added vs. The Street is application of their Global Infrastructure specific valuation framework focused on DCF and IRR, their assessment of long-term volumes, pricing and FCFs and their ability to rate CNR vs. the other Global Infrastructure stocks in their universe, rather than other North American transportation stocks. CNR enters at 4th of 24 on the Insight Stock Ranking System, after Ferrovial, Cellnex and Getlink.
Edition: 153
- 03 February, 2023