Transferring Coverage of Wide-Moat Transurban; Shares Remain Fairly Valued

After transferring coverage to a new analyst, we're maintaining our wide moat rating and medium uncertainty rating for Transurban, and have trimmed our DCF-based fair value estimate to AUD 10.50 per security from AUD 11.20 per security due to slightly lower near-term traffic growth estimates; our long-term forecasts are largely unchanged. At the current price, the security trades in line with our fair value estimate, appropriately incorporating the risk that prices of yield stocks such as Transurban will likely come under pressure in an environment of rising bond yields, increasing the importance of fair value estimates that reflect long-term intrinsic value.