Wouldn’t it be nice to own a dividend stock you could largely ignore while it steadily sends cash your way and grows that income over time? For Canadian investors, Brookfield Infrastructure Partners (TSX: BIP.UN) is a compelling candidate for that role.
Source: Getty Images
A distribution that keeps growing
Consider what has happened over the long term. Brookfield Infrastructure has increased its distribution for 17 consecutive years. In January, it raised the quarterly distribution by 5.8% to an annualized payout of US$1.82. Management continues to target annual distribution growth of 5% to 9%.
This history is telling because the real attraction of a long-term income investment isn’t simply today’s yield. It’s what that income can become after years of increases. An investor who bought BIP.UN a decade ago for a yield of about 4.7% and held through the ups and downs could now be collecting substantially more income relative to their original investment — roughly a yield on cost of about 9.5%.
And the distributions aren’t the whole story. Brookfield Infrastructure’s total return has historically benefited from both rising cash distributions and growth in the underlying business. Its latest results suggest that the growth engine remains intact.
For the first half of 2026, funds from operations (FFO) per unit increased 10% year over year to US$1.79. The payout ratio was just 65%, leaving a meaningful portion of cash flow available to fund growth and support future distributions.
Why the cash flow can keep growing
Brookfield Infrastructure owns and operates critical infrastructure across utilities, transport, midstream and data assets. Many of these businesses generate relatively predictable cash flow through regulated or contracted arrangements.
The company targets organic growth of 6% to 9%, supported by inflation-linked price increases, higher volumes, and newly commissioned projects. The results of this formula were evident in the first half of the year: data FFO jumped 41%, midstream FFO rose 14%, and FFO showed stability in its utilities and transport segments.
Perhaps more importantly, Brookfield Infrastructure is positioned to benefit from the enormous demand for data infrastructure. Its data business is expanding through data centres, fibre, and telecom infrastructure.
As of June 30, Brookfield Infrastructure had just over US$8.0 billion of projects on its capital backlog to help drive growth for the next two to three years.
For example, Brookfield Infrastructure had partnered with Intel to build two semiconductor foundries in the U.S. — so far Brookfield Infrastructure has invested US$3.7 billion in the project, including about US$1.1 billion this year.
Set it, forget it — but don’t forget the risks
Of course, “set it and forget it” doesn’t mean risk-free. BIP.UN is more complex than a traditional Canadian utility, with substantial capital requirements, global operations, foreign-currency exposure, and businesses tied to cyclical non-utility sectors. Interest rates and market sentiment can also cause significant unit-price volatility.
Investors should also remember that BIP.UN pays distributions rather than conventional corporate dividends, and the tax treatment can differ depending on the account. Notably, it is planning to combine with Brookfield Infrastructure Corp. (TSX: BIPC) in the fourth quarter to become a single corporate entity that should pay out eligible dividends for Canadians.
No matter what, the combination of essential infrastructure, recurring cash flow, a long distribution-growth record and substantial investment opportunities makes Brookfield Infrastructure an intriguing long-term income investment.
The bottom line
The utility isn’t a stock to buy and literally forget about. But for investors seeking growing income and exposure to infrastructure, its 17-year distribution-growth streak, targeted payout ratio of 60–70%, and FFO growth potential provide a strong foundation for a long-term “set it and forget it” strategy.
The stock just experienced a dip recently. At $50.24 per unit at writing, it offers a cash distribution yield of about 5.0%, with analyst consensus price targets suggesting a discount of about 18-25%.
