The Transurban Group (ASX: TCL) share price has been underperforming so far in 2021.
Since the start of the year, the toll road operator's shares have risen just 1% to $13.75.
This compares unfavourably to the S&P/ASX 200 Index (ASX: XJO) and its solid 11% gain over the same period.
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Is the Transurban share price good value?
According to a note out of Credit Suisse, its analysts believe the Transurban share price could be good value at the current level. This follows the release of the company's first quarter update last week.
That update revealed a significant decrease in overall average daily traffic year on year, due to lockdowns in key markets. Transurban reported overall average daily traffic (ADT) volumes down 12.4% year on year and 34.5% when compared to 2019.
However, this wasn't as bad a Credit Suisse was expecting. In light of this and the earlier than forecast reopening of Melbourne and Sydney from lockdowns, the broker has upgraded its earnings and dividend estimates materially.
Estimates upgraded
The broker is now forecasting dividends of 41.5 cents per share in FY 2022 and then 61.5 cents per share in FY 2023. Based on the current Transurban share price, this implies yields of 3% and 4.5%, respectively.
In addition, Credit Suisse has retained its outperform rating and increased its price target on the company's shares to $15.15. This suggests there's upside of 10% for its shares over the next 12 months.
And if you add in dividends, the potential return on offer stretches to over 13% for investors.
All in all, while the Transurban share price has underperformed this year, Credit Suisse appears to see this as a buying opportunity now.
