Atlas Arteria's (ASX:ALX) Autoroutes Paris-Rhin-Rhone business will continue to be impacted by the French government's transport-related taxes until fiscal 2028, said Jefferies in a Wednesday note.

The company on Wednesday reported a nearly 11% year-over-year increase in proportionate toll revenue for the third quarter ended Sept. 30, boosted by toll increases and beneficial movements in foreign exchange rates.

The investment firm believes that the company's current dividends will not be sustainable beyond calendar 2028 if the uncertainty around France's tax rate continues.

Jefferies added that the company still has more value above its current share price, even after including higher-than-market taxes in France, but few near-term catalysts to close this gap.

Jeffeirs reaffirmed a buy rating on Atlas Arteria and lowered its price target to AU$5.91 from AU$6.39.

The toll road operator's shares rose nearly 1% in recent Thursday trade.