Aurizon Holdings: Solid growth but captured in the share price

About the author:

Nathan Lead
Author name:
By Nathan Lead
Job title:
Senior Analyst
Date posted:
12 December 2023, 7:30 AM
Sectors Covered:
Infrastructure, Utilities, Banks

  • We expect Aurizon Holdings (ASX:AZJ) to deliver strong EBITDA growth in FY24 and to a lesser extent FY25-26. However, we think the likely step-up in debt service is under-appreciated.
  • Expect mid-teen compound growth in EPS/DPS across FY24-26F. Our FY26F dividend forecast implies 7.1% cash yield at current prices vs 4.7% for FY24F.
  • HOLD at current prices, given (login to view) target price and c.6% potential TSR.

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