Canaccord Genuity (TSX:CF, LSE:CF) has reiterated its 'sell' rating on 3i Infrastructure PLC (LSE:3IN), saying the shares look fully valued following their recent rise.
3i Infrastructure's share price has risen 7.6% over the past three months and the company paid a 6.73p dividend in July, giving a total return of approximately 10%.
Canaccord said the shares are trading close to the company's last published net asset value of 405p and at an all-time high, with no realisation activity indicating a substantial increase in NAV.
The broker said a discount of approximately 10% would be more appropriate given the concentration of the portfolio, with the largest five investments accounting for approximately 70% of net asset value.
Canaccord also flagged valuation risks across the infrastructure sector, warning that rising global bond yields could push up discount rates and affect company valuations.
3i Infrastructure's pro forma cash position was £107 million. This is equivalent to 3% of NAV, after the £980 million TCR sale proceeds were used to repay its revolving credit facility in full, and after adjusting for completion of the Lefdal Mine Datacenter investment and the final dividend.
