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2 great ASX infrastructure shares to buy today

There are a number of different asset classes and infrastructure is one of them. A lot of infrastructure isn’t listed on any stock exchange because it’s privately owned.

You can get exposure to infrastructure through funds such as the Magellan Infrastructure Fund (ASX: MIC). However, there are a few infrastructure stocks that are listed on the ASX.

A stock isn’t a ‘buy’ just because it’s an infrastructure stock, it needs the same analysis as any other business. Here are two businesses that own infrastructure that I think are worth a buy:

Auckland International Airport Ltd (ASX: AIA)

This business is the operator of Auckland Airport. It also owns 24.99% of Queenstown Airport and 24.55% of Queensland Airports Mackay and Cairns.

Airports are some of the best infrastructure in the world, they have virtual monopolies and large tailwinds thanks to an increasingly globe-trotting world population.

There is a tourism boom happening in Australia and New Zealand, more and more passengers are flying to the region every year.

In its half-year report to 31 December 2016 it disclosed a 12.9% growth of international passengers and a 16.7% growth of domestic passengers. This translated into 10.8% growth in revenue, 17.6% growth in the dividend and 18.6% growth in underlying earnings per share.

Auckland Airport is currently trading at 34x FY17’s estimated earnings with an unfranked dividend yield of 2.74%.

Vocus Group Ltd (ASX: VOC)

Vocus is a telecommunications business with a market capitalisation of $3 billion. It’s known for brands such as Dodo, iPrimus and Commander, but it also has a wonderful network of fibre optic cables.

This network is very valuable to Vocus. The amount of data Australians consume is growing exponentially and the data has to be transmitted along some sort of network. By owning its own network Vocus can earn good margins and generate income from other companies using the cables.

The market clearly liked Vocus’ results as the shares went up by over 9% yesterday, with underlying diluted earnings per share growing by 25.7%.

Vocus is trading at 13.8x FY17’s estimated earnings with a grossed-up dividend yield of 4.16%.

Foolish takeaway

I think both of these stocks are worth a place in a Foolish portfolio due to their recurring and defensive nature. Of the two, Auckland Airport is my favourite, but today’s price may not be the best time to buy. The US Federal Reserve increasing the interest rate could create a better buying opportunity down the track, but it’s definitely one to keep an eye on.

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Motley Fool contributor Tristan Harrison has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.