Breakout for Brookfield: Partners in Infrastructure

10/31/2019 5:00 am EST


Leo Fasciocco

Investment Columnist and Publisher, Ticker Tape Digest

Our breakout stocks are most suitable for aggressive investors seeking ideal entry points into leading stocks, especially during bull markets; our latest breakout idea is Brookfield Infrastructure Partners (BIP), notes Leo Fasciocco, editor of Ticker Tape Digest.

Brookfield Infrastructure, based in Bermuda, is an is an asset management firm that owns and operates utilities, transport, energy and communications infrastructure businesses in North and South America, Europe and Asia Pacific. Annual revenues are $4.7 billion.

The utilities segment consists of electricity, natural gas connections, electricity transmission and a coal export terminal). Its transport segment consists of open access systems that provide transportation, storage and handling services for freight, bulk commodities and passengers.

Quarterly net will be strong. This year, analysts are forecasting a 343% surge in net to $3.43 a share from the weak 59 cents the prior year. The stock sells with a price-earnings ratio of 14.

Net for the third quarter should climb to 82 cents a share from a loss of 10 cents the year before. Then in the fourth quarter, the Street is predicting a profit of 90 cents a share, up sharply from the 6 cents the prior year. Looking out to 2020, the Street is calling for a 16% rise in net.

BIP's stock has broken out from its six-week, cup-and-handle base. The move carries the stock to a new all-time high. That is bullish. The stock has a beta of 0.82 versus 1.00 for the stock market. BIP's momentum indicator is strongly bullish.

We are targeting BIP for a move to $58 within the next few months, or sooner. A protective stop can be placed near $47 giving it room. We recommend this breakout idea for conservative bulls.

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