I first invested in Brookfield Infrastructure Partners (BIP +0.92%) (BIPC +1.11%) nearly five years ago. Unfortunately, the stock hasn't been a big winner for me.
Given this mediocre past performance, you might think I'd consider exiting my position in the stock. Nope. Instead, I recently added to my stake in Brookfield Infrastructure. Here are three reasons why I just bought more units of this limited partnership (LP).
NYSE: BIP
Key Data Points
1. Reliable and growing distributions
Brookfield Infrastructure's total returns have been significantly better than its stock performance. That's because the company pays reliable and growing distributions.
Its forward distribution yield currently stands at 5.67%. Brookfield Infrastructure has a 16-year history of distribution increases. During that time, the LP has increased its distribution per unit by a compound annual growth rate (CAGR) of 9%.
I think Brookfield Infrastructure should be able to continue growing its distribution. The company targets an annual growth rate of between 5% and 9%. Its payout ratio target range is a comfortable 60% to 70%.
Am I relying on Brookfield Infrastructure's distributions as a source of income right now? No. However, I view the stock as a great income-generator down the road. In the meantime, I can reinvest the juicy distributions in Brookfield Infrastructure or other stocks that I expect to deliver solid total returns over the next few years.
2. A diversified and stable underlying business
Another reason I recently invested more in Brookfield Infrastructure is that its underlying business of investing in infrastructure assets is diversified and stable. That's important to me with the uncertainty surrounding the ultimate impact of tariffs on the global economy.
Around 41% of Brookfield Infrastructure's funds from operations (FFO) comes from its transportation businesses. The company operates 36,300 kilometers of rail operations in Australia, Brazil, Europe, North America, and the U.K. It also owns 3,300 kilometers of toll roads in Brazil and Peru.
Image source: Getty Images.
Brookfield Infrastructure also has major utility operations that generate 25% of its FFO. These include 3,500 kilometers of gas pipelines and 3,140 kilometers of electricity transmission lines.
I'm a fan of midstream energy stocks. Brookfield Infrastructure is a big player in this space, too, with 15,000 kilometers of transmission pipelines, 16 natural gas and natural gas liquids processing plants, and storage facilities that can hold 570 billion cubic feet of natural gas.
This LP is invested in technology and telecommunications, as well. It has 28,000 kilometers of fiber optic cable and 306,000 operational telecom towers. The company's infrastructure assets also include over 140 data centers and two semiconductor manufacturing foundries.
3. Solid growth opportunities
Since 2009, Brookfield Infrastructure Partners has increased its FFO per unit by a CAGR of 14%. The company expects to continue growing FFO per unit by a double-digit percentage in the future. And I think it will be able to achieve this goal.
Brookfield Infrastructure's management team likes to point to three trends driving the company's growth: digitalization, decarbonization, and deglobalization. Digitalization refers to growth opportunities related to increasing data consumption, especially in data centers. Decarbonization reflects the push to reduce carbon emissions, a trend that could boost the use of cleaner-burning natural gas. Deglobalization involves the supply chain shifts that are moving essential manufacturing closer to home, which helps Brookfield Infrastructure's transportation businesses.
The company is investing heavily in growth, with a capital backlog of more than $7.9 billion. Considering the tremendous growth in demand for artificial intelligence (AI), it isn't surprising that nearly three-quarters of this backlog is related to data infrastructure assets.
I also like that part of Brookfield Infrastructure's growth strategy is to sell mature assets when it can obtain attractive returns. For example, during the first seven months of 2025, the company generated proceeds of around $2.4 billion from selling nine assets.
