Investment Analysts’ Recent Ratings Updates for Kinder Morgan (KMI)

Kinder Morgan (NYSE: KMI) has recently received a number of price target changes and ratings updates:

• 7/27/2017 – Kinder Morgan was upgraded by analysts at Zacks Investment Research from a “sell” rating to a “hold” rating. According to Zacks, “Kinder Morgan has the largest network of natural gas pipeline in North America that spreads over almost 70,000 miles. Most importantly, the company’s midstream properties are linked to all the prospective plays in the U.S. that are rich in natural gas. These extensive pipeline networks, for which almost $32 billion has been invested to date, have been providing Kinder Morgan with stable fee-based revenues. In fact, the company believes that 91% of cash flow in 2017 will come from fee-based contracts. For the second quarter, the company reported in-line earnings, attributed to increased contribution from liquid terminals. However, the bottom line fell year over year owing to higher expenses and negative impact of tariff rates on Colorado Interstate Gas Company pipeline. Also, the company’s total debt now stands higher than equity capital, reflecting balance sheet weakness.”
• 7/27/2017 – Kinder Morgan is now covered by analysts at Mizuho. They set a “neutral” rating and a $22.00 price target on the stock.
• 7/22/2017 – Kinder Morgan had its “buy” rating reaffirmed by analysts at Raymond James Financial, Inc..
• 7/20/2017 – Kinder Morgan had its “hold” rating reaffirmed by analysts at Jefferies Group LLC. They now have a $20.00 price target on the stock.
• 7/14/2017 – Kinder Morgan had its “buy” rating reaffirmed by analysts at Stifel Nicolaus. They now have a $25.00 price target on the stock.
• 7/11/2017 – Kinder Morgan was downgraded by analysts at Zacks Investment Research from a “hold” rating to a “sell” rating. According to Zacks, “The Desjardins Group – the largest association of credit unions in North America – has decided to refrain from lending funds for energy pipeline projects. This decision to stop funding such projects until September has been taken to halt the expansion of pipeline facilities which might harm the environment through accidents like oil spillage. Although this decision by credit unions is only temporary, it might be made permanent later. Meanwhile, this stance by credit unions is not in favor of Trans Mountain pipeline expansion and hence raises questions over Kinder Morgan’s prospects. We are also concerned about the company’s weak balance sheet. As of the first quarter of 2017, total debt – both short and long term – stands at $38.2 billion. The debt level is also higher than the total equity capital of $35 billion, which reflects the company’s high leverage position.”
• 7/5/2017 – Kinder Morgan was upgraded by analysts at BidaskClub from a “strong sell” rating to a “sell” rating.
• 7/3/2017 – Kinder Morgan had its “overweight” rating reaffirmed by analysts at Morgan Stanley. They now have a $25.00 price target on the stock.
• 6/27/2017 – Kinder Morgan had its price target lowered by analysts at Royal Bank Of Canada from $25.00 to $22.00. They now have a “sector perform” rating on the stock.
• 6/23/2017 – Kinder Morgan had its “hold” rating reaffirmed by analysts at Jefferies Group LLC. They now have a $23.00 price target on the stock.
• 6/20/2017 – Kinder Morgan had its “strong-buy” rating reaffirmed by analysts at Raymond James Financial, Inc.. They now have a $23.00 price target on the stock, down previously from $27.00.
• 6/20/2017 – Kinder Morgan was given a new $26.00 price target on by analysts at TD Securities. They now have a “buy” rating on the stock.
• 6/20/2017 – Kinder Morgan was given a new $26.00 price target on by analysts at BMO Capital Markets. They now have a “buy” rating on the stock.
• 6/13/2017 – Kinder Morgan was upgraded by analysts at Zacks Investment Research from a “sell” rating to a “hold” rating. According to Zacks, “Kinder Morgan has the largest network of natural gas pipeline in North America that spreads over almost 70,000 miles. Most importantly, the company’s midstream properties are linked to all the prospective plays in the U.S. that are rich in natural gas. These extensive pipeline networks, for which almost $32 billion has been invested to date, have been providing Kinder Morgan with stable fee-based revenues. In fact, the company believes that 91% of cash flow in 2017 will come from fee-based contracts. Moreover, since inception, Kinder Morgan spent significantly on acquisitions and asset expansion, helping the company generate high distributable cash flow. However, for supporting these investments, the company’s total debt now stands higher than equity capital, reflecting balance sheet weakness.Also, Kinder Morgan’s year-to-date pricing chart shows weakness.”
• 5/31/2017 – Kinder Morgan was downgraded by analysts at Zacks Investment Research from a “hold” rating to a “sell” rating. According to Zacks, “Kinder Morgan is facing strong oppositions from two political parties in British Columbia for its Trans Mountain expansion project. Recently, the company clinched a $1.3 billion from the IPO of its Canadian unit, which is among the largest in the nation, for financing the expansion project. This could significantly increase the transportation capacity of Trans Mountain pipeline and boost the country’s crude export to Asia. However, the political disturbances that have been hurting the pipeline development have raised questions about the company’s future cash flow realizations. As a result, the stock lost more than 4%. Moreover, over the last one month, Kinder Morgan shares depreciated 10.3% as against 3% decline for the broader industry. The company’s dividend yield is also unimpressive.”
• 5/31/2017 – Kinder Morgan had its “buy” rating reaffirmed by analysts at Raymond James Financial, Inc..
• 5/30/2017 – Kinder Morgan was downgraded by analysts at Wolfe Research from an “outperform” rating to a “market perform” rating. They now have a $21.00 price target on the stock, down previously from $26.00.

Kinder Morgan, Inc. (NYSE:KMI) traded down 0.34% during midday trading on Friday, hitting $20.40. 7,682,447 shares of the stock were exchanged. Kinder Morgan, Inc. has a 1-year low of $18.31 and a 1-year high of $23.36. The company’s 50 day moving average is $19.33 and its 200-day moving average is $20.69. The stock has a market cap of $45.49 billion, a PE ratio of 67.11 and a beta of 0.63.

Kinder Morgan (NYSE:KMI) last issued its earnings results on Wednesday, July 19th. The pipeline company reported $0.14 EPS for the quarter, missing the consensus estimate of $0.15 by $0.01. Kinder Morgan had a return on equity of 4.41% and a net margin of 6.20%. The firm had revenue of $3.37 billion during the quarter, compared to analysts’ expectations of $3.12 billion. During the same period in the previous year, the firm earned $0.15 earnings per share. The firm’s quarterly revenue was up 7.1% compared to the same quarter last year. On average, analysts expect that Kinder Morgan, Inc. will post $0.64 earnings per share for the current year.

The company also recently announced a quarterly dividend, which will be paid on Tuesday, August 15th. Investors of record on Monday, July 31st will be paid a $0.125 dividend. This represents a $0.50 annualized dividend and a dividend yield of 2.45%. The ex-dividend date is Thursday, July 27th. Kinder Morgan’s payout ratio is 161.29%.

In other news, insider Richard D. Kinder bought 500,000 shares of the firm’s stock in a transaction that occurred on Tuesday, May 30th. The shares were bought at an average cost of $18.58 per share, with a total value of $9,290,000.00. Following the completion of the purchase, the insider now directly owns 234,712,353 shares in the company, valued at $4,360,955,518.74. The purchase was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, VP Dax Sanders bought 2,600 shares of the firm’s stock in a transaction that occurred on Tuesday, May 30th. The stock was purchased at an average cost of $18.60 per share, for a total transaction of $48,360.00. The disclosure for this purchase can be found here. 13.99% of the stock is owned by insiders.

Kinder Morgan, Inc is an energy infrastructure company. It operates through five segments. Its Natural Gas Pipelines segment is engaged in the ownership and operation of interstate and intrastate natural gas pipeline and storage systems, and liquefied natural gas facilities, among others. Its CO2 segment is engaged in the production, transportation and marketing of carbon dioxide (CO2) to oil fields and the ownership and operation of a crude oil pipeline system, among others.