Utilities & Regulated Infrastructure

Investment-grade utilities and infrastructure issuers.

The utilities and regulated infrastructure sector currently presents a compelling opportunity for fixedincome investors seeking to capture significant yield within the investmentgrade space. Despite the defensive nature of these issuers, current market pricing has pushed yields for highquality names into the 29% to 33% range, creating a notable disconnect between the stable, regulated cash flows of these entities and their present valuations. This dislocation is particularly evident in the longdated paper from major North American players. For instance, Brookfield Infrastructure (BIP) issues are currently trading at yields exceeding 31%, while Sempra (SRE) and NextEra Energy (NEE) offer comparable return profiles near the 30% mark. For investors focused on credit quality, these BBBrated instruments provide an attractive entry point to gain exposure to essential infrastructure assets at price levels that offer substantial potential for total return, provided the underlying credit fundamentals remain resilient.