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Transurban Group
Industrials · Infrastructure Operations
Updated just now
$13.86
MARKET CAP
$43.25B
P/E RATIO
322.6
DIV. YIELD
4.8%
FRANKING
2%
Transurban Group, together with its subsidiaries, engages in the development, operation, management, and maintenance of toll road networks in Australia and North America.
View full descriptionThe Warsi Rating combines two proven approaches: value investing principles and dividend strategy. A stock must score 70+ on both to be rated Solid or higher.
$2.04
Discounted cash flow estimate
$8.67
For 6% dividend yield
Business quality and balance-sheet durability.
Real cash left after running the business
Positive cash generation. Company produces real cash after capital expenditures - can fund dividends, buybacks, or growth.
Current Snapshot
Current FCF
$608M
Pass Rule
> $0
Status
Positive
Why It Matters
Free cash flow is the cash available after core operating and capital needs. It is central to dividend capacity.
Formula
Operating Cash Flow - Capital ExpendituresMethod
Review whether free cash flow is consistently positive and whether it is sufficient relative to dividends and debt needs.
Worked Example
This company generated $608M in free cash flow — cash left after operating costs and capital expenditure. Positive FCF means dividends are funded by real cash generation.
How to Interpret
Persistently negative free cash flow can force reliance on borrowing or equity issuance to maintain payouts.
Positive cash flow means dividends are funded by actual money, not accounting profits. As Buffett says, "Cash is fact, profit is opinion." Your income is backed by real cash generation.
Sources
Profit generated per $1 of shareholder investment
Short-term assets vs. short-term debts
Price versus estimated intrinsic value and required return thresholds.
What percentage of the stock price comes back as earnings each year
Consistency of profits over time
Is the business growing — and is debt being managed responsibly?
Revenue growing with stable debt levels — a positive sign of organic growth that supports future dividends.
Current Snapshot
Revenue Change
+10.7%
Debt Change
+19.4%
Trend State
Improving
Why It Matters
Revenue trend shows whether the business is expanding or contracting. Debt trend adds context on whether growth is being funded conservatively.
Formula
Revenue Change (%) = (Latest Revenue - Earliest Revenue) / |Earliest Revenue| x 100; Debt Change (%) = (Latest Debt - Earliest Debt) / |Earliest Debt| x 100Method
Map annual revenue history and, where relevant, annual debt history. For financial companies, debt is excluded because deposits and reserves distort this signal.
Worked Example
Revenue changed by +10.7% across the displayed period, while debt changed by +19.4%.
How to Interpret
Rising revenue with stable or falling debt is typically stronger than rising revenue funded by rapidly rising leverage.
Revenue growing with stable debt levels — a positive sign of organic growth that supports future dividends.
Sources
Annual dividends as percentage of stock price
3.75% yield is well below the 6% target. Not suitable for Barsi's income strategy.
Current Snapshot
6Y Avg Yield
3.8%
6% Requirement
6.0%
Gross Yield
3.8%
Why It Matters
Yield translates dividend income into a percentage of the price paid, which is central to income-first screening.
Formula
Annual Dividends per Share / Stock Price x 100Method
Use the 6-year average annual dividend for consistency and compare the result with the 6% framework requirement.
Worked Example
With a 6-year average annual dividend of $0.52 and a share price of $13.86, the Barsi yield is 3.8%. The minimum requirement is 6%. Including franking credits, the gross yield is 3.8%.
How to Interpret
Higher sustainable yield improves upfront income, but unusually high yields may reflect elevated risk or weak coverage.
Low yield means you need significant capital to generate meaningful income. Barsi's strategy focuses on stocks that provide substantial cash flow from day one.
Sources
Track record of consistent dividend payments
| Ex-Date | Pay Date | Gross | Franking | Net | Credit |
|---|---|---|---|---|---|
| ~1 July 2026Est | ~27 July 2026 | ~$0.26 | 0% | ~$0.26 | $0.00 |
| ~31 Dec 2026Est | ~24 Feb 2027 | ~$0.26 | 0% | ~$0.26 | $0.00 |
Highest price to lock in 6% yield
Industry category of the business
Industrials is not a BESST sector. Non-BESST stocks receive a lower base score but can still qualify with exceptional dividend metrics.
Current Snapshot
Industry
Infrastructure Operations
BESST Match
No
Score Impact
No bonus
Why It Matters
Sector classification helps contextualise risk and demand durability, which can materially affect dividend stability.
Formula
BESST Match = Sector in {Banks, Energy, Sanitation, Insurance, Telecom}Method
Match company sector or industry against BESST categories. A match adds scoring support but does not replace core dividend checks.
Worked Example
This company operates in Infrastructure Operations (Industrials sector). It does not match a BESST sector, so it receives the standard base score. Non-BESST stocks can still qualify with strong dividend metrics.
How to Interpret
Sources
How much of a company's earnings are paid out as dividends
The company is paying out more in dividends than it earns (435%). This is unsustainable long-term and often signals a dividend cut ahead. An inflated payout also distorts the price ceiling calculation used in our analysis.
Current Snapshot
Latest Ratio
435.1%
Healthy Range
30%-75%
Zone
Unsustainable
Why It Matters
Payout ratio links dividends to earnings capacity and helps evaluate whether current distributions are likely to remain supportable.
Formula
Payout Ratio (%) = (Annual Dividend per Share / Earnings per Share) x 100Method
Calculate year-by-year payout ratios where EPS is positive, classify each year by sustainability zone, and compare with the current TTM ratio.
Worked Example
$0.67 dividend / $0.04 EPS equals 1558.1% payout ratio.
How to Interpret
Ratios in the middle range are usually more sustainable than very high ratios. Values above 100% indicate dividends exceeded earnings in that period.
The company is paying out more in dividends than it earns (435%). This is unsustainable long-term and often signals a dividend cut ahead. An inflated payout also distorts the price ceiling calculation used in our analysis.
Sources
10-year ROE trends, dividend history, price ceiling calculations, and every red flag explained.
See the Full BreakdownFree. No card. 10 seconds.
1.9% average is below the 6% threshold. This suggests the business may lack a durable competitive advantage.
Current Snapshot
10Y Avg
1.9%
Threshold
6.0%
Worst Year
-2.4%
Why It Matters
ROE shows how effectively management turns shareholder capital into profit. High and stable ROE can signal pricing power, cost discipline, or both.
Formula
Net Income / Shareholders' Equity x 100Method
Use the 10-year average ROE and review the weakest year to check whether returns stayed resilient across cycles.
Worked Example
This company's 10-year average ROE is 1.9%, meaning each $1 of shareholder equity generates $0.02 in annual profit. The threshold is 6%, and the worst single year was -2.4%.
How to Interpret
Higher and steadier ROE generally supports stronger long-term compounding. Large drawdowns in weak years can point to fragility.
Lower ROE means your investment compounds more slowly. At 1.9%, this business needs more capital to generate the same returns as competitors. Consider whether other strengths (yield, stability) compensate for weaker profitability.
Sources
Current ratio of 0.59 is below 1.0 - company may struggle to pay short-term obligations.
Current Snapshot
Current Ratio
0.59x
Warning Floor
1.00x
Target
1.50x
Why It Matters
Liquidity supports operational stability. Companies with weak liquidity can face pressure even when long-term fundamentals are sound.
Formula
Current Assets / Current LiabilitiesMethod
Compare the current ratio to the warning floor and target level used in the framework.
Worked Example
This company's current ratio is 0.59x — it has $0.59 in short-term assets for every $1 of short-term liabilities. The target is 1.5x, with a warning floor at 1.0x.
How to Interpret
Ratios above the target suggest healthier short-term resilience; ratios below 1.0x can indicate immediate funding risk.
Tight liquidity means the company may need to borrow or sell assets to pay bills. Dividends are often the first expense cut when cash runs low.
Sources
0.3% earnings yield is below the 7.5% threshold. You'd earn nearly as much from safer government bonds, which means the extra risk of owning shares isn't being compensated.
Current Snapshot
Current Yield
0.3%
Required Yield
7.5%
Spread
-7.2pp
Why It Matters
Earnings yield reframes valuation as return on price paid. It helps compare equity earnings power against lower-risk alternatives.
Formula
(Earnings per Share / Stock Price) x 100Method
Calculate current earnings yield, then compare it to the required yield for the stock's industry setting.
Worked Example
With EPS of $0.04 and a share price of $13.86, earnings yield is 0.3%. The required yield for this industry is 7.5% (based on 4.5% government bond rate plus a risk premium).
How to Interpret
A yield above the required level suggests better valuation support; below it indicates thinner compensation for equity risk.
Returns don't justify the added risk compared to safe bonds. Consider whether the dividend yield alone compensates, or wait for a better price.
Sources
How current price compares with estimated intrinsic value
Stock is trading 871% ABOVE the fair-value threshold (includes 30% margin of safety) and above the estimated intrinsic value.
Current Snapshot
Current Margin
-579.4%
Industry Threshold
30%
Status
579% Overvalued
Why It Matters
Margin of safety provides a valuation buffer against modelling uncertainty and adverse business outcomes.
Formula
(Estimated Intrinsic Value per Share - Current Price) / Estimated Intrinsic Value per Share x 100Method
Estimate intrinsic value using a two-stage DCF (10-year projection plus terminal value), then compare with current price.
Worked Example
For this stock now: intrinsic value is $2.04 per share, current price is $13.86, and margin of safety is -579.4%.
How to Interpret
Positive margin indicates price below modelled value; negative margin indicates price above modelled value. Compare against the industry's required buffer.
The market price is above both your required threshold and intrinsic value estimate. Under this methodology, there is no valuation buffer for estimate error or market volatility.
Sources
9/4 positive EPS years. Limited data - full evaluation requires 8+ years. Monitor closely for consistency.
Current Snapshot
Positive Years
9/4
Allowed Losses
0 (limited)
EPS CAGR
-1.5%
Why It Matters
Consistency in EPS helps distinguish resilient earnings power from one-off performance spikes.
Formula
Positive EPS Years / Available EPS YearsMethod
For 8+ years of data, apply industry-specific loss tolerance. For limited data, every available year must be positive.
Worked Example
This company reported positive earnings in 9 of the last 4 years. With only 4 years of data, every year must be positive. EPS growth rate (CAGR) is -1.5%.
How to Interpret
Fewer loss years and stronger EPS continuity generally improve confidence in future dividend and valuation assumptions.
So far so good, but limited history means we haven't seen how this company handles a full economic cycle. Monitor closely for continued consistency.
Sources
How much earnings are consumed by capital expenditure
CapEx consumes 703% of cumulative earnings — above the 100% threshold. Expected for this capital-intensive sector.
Current Snapshot
10Y CapEx Intensity
703%
Threshold
100%
Buffer
-603%
Why It Matters
CapEx intensity estimates how much of earnings must be reinvested just to sustain operations.
Formula
Cumulative CapEx (10yr) / Cumulative Net Income (10yr) x 100Method
Aggregate 10-year CapEx and net income, then compare the ratio with the sector threshold in the framework.
Worked Example
Over 10 years, 703% of this company's cumulative earnings were consumed by capital expenditure. The infrastructure & transport threshold is 100%, leaving a buffer of -603% (over threshold).
How to Interpret
Lower ratios usually indicate better cash conversion. Higher ratios can reduce room for dividends and buybacks.
High capital intensity means most earnings go back into maintaining the business rather than rewarding shareholders. This is typical for this sector but limits dividend growth potential.
Sources
Percentage of revenue that becomes profit after all expenses
3.5% net margin is below the 15% threshold. May reflect this sector's structural characteristics.
Current Snapshot
Current Margin
3.5%
Threshold
15.0%
Relative Position
-11.5%
Why It Matters
Net income margin shows how much profit the business keeps from each dollar of revenue after all costs.
Formula
Net Income / Total Revenue x 100Method
Compare current margin with the industry-specific threshold to avoid cross-sector distortions.
Worked Example
This company's net income margin is 3.5% — it keeps 4 cents of every revenue dollar as profit after all expenses. The infrastructure & transport threshold is 15%, putting it 11.5% below the requirement.
How to Interpret
Margins that are both strong and stable can indicate competitive strength; persistent weakness may limit reinvestment and payout capacity.
Lower margins in this sector are common, but they leave less cushion if costs rise or revenue drops. Monitor whether margins are stable over time — consistency matters more than the absolute level.
Sources
| Ex-Date | Pay Date | Gross | Franking | Net | Credit |
|---|---|---|---|---|---|
| 30 Dec 2025Interim | 24 Feb 2026 | $0.34 | 0% | $0.34 | $0.00 |
| 27 June 2025Final | 25 July 2025 | $0.33 | 0% | $0.33 | $0.00 |
| 30 Dec 2024Interim | 27 Jan 2025 | $0.32 | 0% | $0.32 | $0.00 |
| 27 June 2024Final | 25 July 2024 | $0.32 | 0% | $0.32 | $0.00 |
| 28 Dec 2023Interim | 25 Jan 2024 | $0.30 | 0% | $0.30 | $0.00 |
| 29 June 2023Final | 27 July 2023 | $0.32 | 0% | $0.32 | $0.00 |
| 29 Dec 2022Interim | 26 Jan 2023 | $0.27 | 0% | $0.27 | $0.00 |
| 29 June 2022Final | 27 July 2022 | $0.26 | 0% | $0.26 | $0.00 |
| 30 Dec 2021Interim | 27 Jan 2022 | $0.15 | 0% | $0.15 | $0.00 |
| 29 June 2021Final | 27 July 2021 | $0.21 | 0% | $0.21 | $0.00 |
Excellent track record. 10 years of consistent dividends through multiple market cycles.
Current Snapshot
History
10yr
Predictability
Moderate
Payout Health
One-off event
Why It Matters
Payment consistency is a direct test of dividend reliability. Large cuts or skips often appear before confidence recovers.
Formula
Consecutive Years = count of years with dividend payments and no disqualifying skip/cut eventsMethod
Require at least 6 years of history, then check for skipped years and large cuts, allowing approved systemic-event exceptions.
Worked Example
This company has 10 years of dividend history (2016–2025). No suspensions detected — 10 consecutive years of payments. Predictability: Moderate. Payout health: One-off event. The minimum requirement is 6 years.
How to Interpret
Longer uninterrupted records generally signal stronger income reliability than high yield alone.
A 10-year track record through multiple economic cycles gives confidence your income will continue. This company has proven it prioritises shareholder returns.
Sources
Current price ($13.86) is 60% above the ceiling. Wait for a drop to lock in 6% yield.
Current Snapshot
Current Price
$13.86
Max Buy Price
$8.67
Delta
-59.9%
Why It Matters
The price ceiling links valuation discipline to income targets by defining the price that aligns with a 6% yield target.
Formula
6-Year Average Annual Dividend / 0.06Method
Use the 6-year average dividend (not one year) and divide by 0.06 to estimate the maximum entry price for target yield.
Worked Example
With a current price of $13.86 and a ceiling of $8.67, the entry is 59.9% above the ceiling.
How to Interpret
Prices below the ceiling imply a historical yield above 6%; prices above it imply a lower historical yield at entry.
At this price, you won't achieve Barsi's target 6% yield. Consider waiting for a pullback — market volatility often creates more favourable valuations for patient investors.
Sources
BESST alignment is a positive context signal. Non-BESST stocks can still qualify with strong yield and dividend consistency.
Non-essential businesses face demand drops during recessions — discretionary spending is first to be cut. This increases cyclical risk for dividends, but companies with decades of consistent payments can still demonstrate durability.