On Thursday the Transurban Group (ASX: TCL) share price edged ever so slightly higher to finish the day up at $12.79.
This latest gain means that the toll road giant's shares have risen a solid 11% since the start of the year.
Is it too late to invest?
Despite this solid run, one leading broker believes that Transurban's shares are still in the buy zone.
According to a note out of Goldman Sachs, its analysts have retained their buy rating and $13.15 price target on the company's shares.
This price target implies a potential return of approximately 7.5% over the next 12 months including dividends.
Why is the broker positive on Transurban?
Goldman Sachs held firm with its buy rating after Transurban announced that it has received the necessary parliamentary consents to extend the concession end date for CityLink by 10 years to January 2045.
This extension means that tolling and tolling escalation for the CityLink Concession will be extended from 2035 to 2045, and the debt amortisation process will not commence until mid-2035.
The broker notes that this is a big positive as the "extension effectively defers the cashflow impact of the Citylink debt amortisation out of the immediate investable timeframe, and as such provides a greater degree of certainty over the medium term distribution."
In addition to this, the broker has previously spoken favourably about the company's solid management discipline, long term network approach to its assets, and portfolio approach to its balance sheet and capital structure.
Overall, Goldman feels this makes Transurban a great alternative to bonds in the current Australian bond yield environment.
Should you invest?
I think that Goldman Sachs makes some great points and Transurban could be a good option for investors along with fellow dividend shares Rural Funds Group (ASX: RFF) and Sydney Airport Holdings Pty Ltd (ASX: SYD).
