Cohen & Steers Infrastructure Stock Price, News & Analysis

Cohen & Steers Infrastructure Fund, Inc. (NYSE: UTF) is a diversified, closed-end management investment company. The Fund is registered under the Investment Company Act of 1940, as amended, and its stated investment objective is total return with an emphasis on income. UTF trades on the New York Stock Exchange and focuses on securities issued by infrastructure companies.

Investment Objective and Strategy

The Fund’s investment objective is total return with emphasis on income. According to company disclosures, under normal market conditions the Fund will invest at least 80% of its managed assets in securities issued by infrastructure companies. These infrastructure companies include utilities, pipelines, toll roads, airports, railroads, ports, telecommunications companies, and other infrastructure companies. Corporate preferred securities and other fixed income are also part of the Fund’s investment strategy.

The Fund is managed by Cohen & Steers Capital Management, Inc., referred to as the Advisor, which is a wholly owned subsidiary of Cohen & Steers, Inc. The Advisor is responsible for implementing the Fund’s investment policies and for managing the portfolio within the parameters set out in the Fund’s governing documents and prospectus.

Managed Distribution Policy

In March 2015, Cohen & Steers Infrastructure Fund, Inc. implemented a managed distribution policy in accordance with exemptive relief issued by the U.S. Securities and Exchange Commission. The policy seeks to deliver the Fund’s long-term total return potential through regular monthly distributions declared at a fixed rate per common share. This approach is described as giving the Fund greater flexibility to realize long-term capital gains throughout the year and to distribute those gains on a regular monthly basis to shareholders.

The Board of Directors of the Fund may amend, terminate, or suspend the managed distribution policy at any time, and company communications note that such changes could have an adverse effect on the market price of the Fund’s shares. The Fund’s monthly distributions may include long-term capital gains, short-term capital gains, net investment income and/or return of capital for federal income tax purposes. Return of capital includes distributions paid by the Fund in excess of its net investment income and net realized capital gains, with such excess distributed from the Fund’s assets.

The Fund explains that a return of capital is not taxable; instead, it reduces a shareholder’s tax basis in his or her shares of the Fund. In addition, distributions from the Fund’s investments in master limited partnerships (MLPs) are attributed to various sources, including net investment income and return of capital. Company notices emphasize that the amount of monthly distributions may vary depending on factors such as changes in portfolio and market conditions.

Portfolio Focus on Infrastructure

According to the Fund’s description, its infrastructure focus covers a broad range of sectors that provide essential services. These include utilities, which may involve power or related services; pipelines; toll roads; airports; railroads; ports; and telecommunications companies, along with other infrastructure companies. The Fund also identifies corporate preferred securities and other fixed income as part of its investment strategy, alongside its core equity and infrastructure-related holdings.

Company communications describe global infrastructure as a resilient and income-generating asset class, supported by essential services across utilities, energy, transportation, and communications. The Advisor has stated that equity investments in listed infrastructure in key subsectors and stocks offer attractive valuations and growth potential, and that this environment can create portfolio opportunities for total return and income generation at the fund level.

Closed-End Fund Structure and Rights Offerings

Cohen & Steers Infrastructure Fund, Inc. operates as a closed-end fund. Its shares of common stock trade on the NYSE, and the Fund’s net asset value (NAV) is calculated as the total market value of all securities and other assets held by the Fund minus total liabilities, divided by the total number of shares outstanding. Company disclosures note that while NAV performance may be indicative of the Fund’s investment performance, it does not measure the value of an individual shareholder’s investment, which is determined by the Fund’s market price based on supply and demand for the shares in the open market.

The Fund’s Board of Directors has approved transferable rights offerings from time to time. In a rights offering, holders of the Fund’s common stock as of a specified record date receive transferable rights to subscribe for additional shares of common stock. Terms disclosed for such an offering include a formula-based subscription price tied to a percentage of the average market price and a percentage of NAV, the ability for record date stockholders who fully exercise their rights to subscribe for additional shares under an over-subscription privilege, and the trading of the rights on the NYSE under a separate symbol during the subscription period. The Advisor has stated that it pays all offering expenses, including sales commissions, so that the Fund receives the entire proceeds of the offering.

Company statements indicate that an increase in the Fund’s assets through such offerings may allow fixed operating costs to be spread across a larger asset base and may create potential for increased liquidity and trading volume of the Fund’s common shares. The Fund has also indicated expectations regarding maintaining its distribution level around the time of such offerings, while clarifying which shares are entitled to specific declared distributions based on record dates.

Distributions, Tax Reporting, and Performance Metrics

The Fund regularly publishes notices describing the estimated sources of its monthly distributions. These notices break down each distribution into net investment income, net realized short-term capital gains, net realized long-term capital gains, and return of capital (or other capital source), expressed on a per-share basis and as a percentage of the current distribution and year-to-date distributions.

In these notices, the Fund states that shareholders should not draw conclusions about investment performance from the amount of a distribution or from the terms of the managed distribution policy. The Fund also notes that it estimates it has distributed more than its income and capital gains at times, so a portion of distributions may be a return of capital. It emphasizes that a return of capital distribution does not necessarily reflect investment performance and should not be confused with yield or income.

The Fund explains that the amounts and sources of distributions reported in these notices are estimates, are likely to change over time, and are not provided for tax reporting purposes. The final tax characteristics of all distributions are determined after the end of the calendar year and are reported to shareholders on Form 1099-DIV. The Fund states that shareholders should not use the interim estimates in preparing tax returns.

Alongside distribution information, the Fund provides performance and distribution rate metrics based on NAV, such as year-to-date cumulative total return for a given fiscal period, cumulative distribution rate for that period, average annual total return over a multi-year period, and the current annualized distribution rate. The Fund defines year-to-date cumulative total return as the percentage change in NAV over the period, including distributions paid and assuming reinvestment. The cumulative distribution rate is described as the dollar value of distributions in the period as a percentage of NAV at a specified date. Average annual total return is defined as the compound average of annual NAV total returns over the stated period, and the current annualized distribution rate is the current fiscal period’s distribution rate annualized as a percentage of NAV at a specified date.

Relationship with Cohen & Steers

Cohen & Steers Infrastructure Fund, Inc. is advised by Cohen & Steers Capital Management, Inc., which is a wholly owned subsidiary of Cohen & Steers, Inc. Company materials describe Cohen & Steers as a global investment manager specializing in real assets and alternative income, including listed and private real estate, preferred securities, infrastructure, resource equities, commodities, and multi-strategy solutions. Cohen & Steers was founded in 1986 and is headquartered in New York City, with offices in London, Dublin, Hong Kong, Tokyo, and Singapore.

The Advisor has described its view that equity investments in listed infrastructure offer attractive valuations and growth potential in certain macroeconomic environments, citing factors such as demand for power, digitalization, and capital investment opportunities. Company communications also refer to global infrastructure as an asset class supported by essential services across utilities, energy, transportation, and communications.

Risk Considerations

Company disclosures for Cohen & Steers Infrastructure Fund, Inc. highlight risks associated with investing in global infrastructure securities. Infrastructure issuers may be subject to regulation by various governmental authorities and may be affected by regulation of rates charged to customers, operational or other mishaps, tariffs, and changes in tax laws, regulatory policies, and accounting standards. The Fund notes that foreign securities involve special risks, including currency fluctuation and lower liquidity, and that some global securities may represent small and medium-sized companies, which may be more susceptible to price volatility than larger companies.

The Fund also discusses risks specific to closed-end funds. Shares of many closed-end funds frequently trade at a discount from their asset value, and closed-end funds are subject to stock market risk, meaning stock prices may decline over short or long periods, affecting the value of an investment in the fund. Company communications note that a rights offering may result in immediate dilution of NAV per share for existing common stockholders, including those who fully exercise their rights.

In its notices, the Fund repeatedly advises investors to consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing, and to review the Fund’s most recent periodic reports and other regulatory filings available through financial advisors, the Fund’s materials, and the Securities and Exchange Commission’s EDGAR database.

Use of Information and Investor Resources

The Fund states that at the time of each monthly distribution, information on the sources of the distribution is posted and mailed to shareholders in a concurrent notice. However, it emphasizes that this information may change at the end of the year because final tax characteristics cannot be determined with certainty until after the calendar year ends. Final tax characteristics are provided on Form 1099-DIV, mailed after the close of the calendar year.

Company communications consistently state that shareholders should not use the interim distribution notices in preparing tax returns and that the information is not provided for tax reporting purposes. Investors are encouraged to obtain and read the Fund’s prospectus, prospectus supplements, and periodic reports, which contain detailed information about the Fund’s objectives, strategies, risks, charges, and expenses.

Summary

In summary, Cohen & Steers Infrastructure Fund, Inc. (UTF) is a NYSE-listed, diversified closed-end fund focused on total return with an emphasis on income, primarily through investments in securities issued by infrastructure companies. It operates under a managed distribution policy designed to provide regular monthly distributions that may consist of net investment income, capital gains, and return of capital. The Fund is advised by Cohen & Steers Capital Management, Inc., part of Cohen & Steers, Inc., a global investment manager specializing in real assets and alternative income. The Fund provides detailed disclosures on its distributions, performance metrics based on NAV, rights offerings, and the risks associated with global infrastructure securities and closed-end fund investing.