The Transurban Group (ASX: TCL) share price has been underperforming the market in 2021.
Since the start of the year, the toll road operator's shares have risen 4.5% to $14.32.
This compares to a gain of 12.5% by the S&P/ASX 200 Index (ASX: XJO).
Is the Transurban share price good value?
One leading broker believes the Transurban share price is good value at the current level.
According to a note out of Macquarie, its analysts have retained their outperform rating but trimmed their price target slightly to $14.66.
However, given that the Transurban share price is currently trading at $14.32, the upside potential is reasonably limited.
Nevertheless, Transurban could be a good option for income investors on the search for dividends that could grow in the coming years.
The note reveals that the broker is forecasting dividends per share of 42.3 cents in FY 2022 and then 64.3 cents in FY 2023.
Based on the current Transurban share price, this equates to yields of 3% and 4.5%, respectively, over the next two financial years.
What did the broker say?
Macquarie has revised its earnings forecasts lower to reflect a lengthier than previously expected lockdown. However, it continues to believe that traffic volumes will bounce back quickly once the reopening takes place.
And while it sees downside risk to dividends per share if the reopening takes even longer and also if the company needs to raise capital for its WestConnex acquisition, it believes it is worth sticking with the company.
This is due to Transurban's pipeline of growth projects and the long term benefits of the aforementioned acquisition.
Macquarie isn't alone with its bullish view on the Transurban share price. Last month Ord Minnett put a buy rating and $15.50 price target on its shares. It remains positive due to the strong demand for infrastructure assets.
It commented: "We believe the market value of Transurban's assets remains well ahead of the implied value."
"We believe this supports the underlying thesis on Transurban and is more important than the short-term impact lockdowns are having on traffic and free cash flow," it added.
