Kinder Morgan Offers 6.8% Midstream Yield: 3 Reasons Investors Should Buy On The Drop
May 13, 2023
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Kinder Morgan ($NYSE:KMI) is a leading midstream energy company offering investors a 6.8% midstream yield, making it a compelling option in today’s market. With attractive yields and a strong balance sheet, Kinder Morgan is an attractive investment for those looking to capitalize on the current market decline. Here are three reasons why investors should consider buying Kinder Morgan now:
First, Kinder Morgan is offering a higher yield than the average midstream company, with a yield of 6.8%, making it an attractive option for those looking for income generation. Not only is the yield higher than its peers, but it is also one of the highest-yielding stocks in the sector. Second, Kinder Morgan has a strong balance sheet and solid cash flows. The company has a solid track record of growing its midstream operations and is well positioned to benefit from further expansion opportunities. Furthermore, the company also has a history of increasing its dividend payments over time. Third, Kinder Morgan has a long history of providing reliable and consistent returns for investors, making it an ideal option for those looking for long-term investments. Its diversified portfolio of midstream assets gives investors the potential to benefit from both capital appreciation and cash flow generation. With its strong balance sheet and history of increasing dividend payments, it makes for a compelling option for those looking to benefit from the current market conditions.
Analysis
At GoodWhale, we have conducted a thorough review of KINDER MORGAN‘s investments and have concluded that the company is a medium risk investment. After thorough analysis of their income sheet, balance sheet, and cashflow statement, we have detected 3 risk warnings. KINDER MORGAN has consistently generated positive cash flows each year, but this rate of growth is slowing over time. The company also carries a moderate level of debt, which could be an issue in case of any economic uncertainty. Finally, their financial reserves may not be sufficient to meet any large expenses that might be incurred in the future. For those interested in learning more about KINDER MORGAN’s investment outlook, we recommend registering as a user on GoodWhale to access our detailed reports. Here, you can learn more about the company’s financial and business risks, as well as get insights into its performance. More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Kinder Morgan. More…
| Total Revenues | Net Income | Net Margin |
| 18.8k | 2.55k | 13.5% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Kinder Morgan. More…
| Operations | Investing | Financing |
| 4.97k | -2.17k | -3.15k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Kinder Morgan. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 68.93k | 36.82k | 13.68 |
Key Ratios Snapshot
Some of the financial key ratios for Kinder Morgan are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 13.4% | 2.4% | 22.4% |
| FCF Margin | ROE | ROA |
| 17.8% | 8.6% | 3.8% |
Peers
Kinder Morgan Inc is a leading pipeline transportation and energy storage company in North America. The company operates in three segments: Natural Gas Pipelines, Products Pipelines, and Terminals. Kinder Morgan’s competitors include ONEOK Inc, Kinetik Holdings Inc, and Keyera Corp.
– ONEOK Inc ($NYSE:OKE)
ONEOK Inc. is one of the largest energy midstream service providers in the United States. It owns and operates natural gas liquids (NGL) gathering, processing, transportation and storage assets, as well as natural gas pipelines. The company’s NGL business includes the gathering, processing and transportation of NGLs, as well as the storage and marketing of propane, butane and natural gasoline. The company’s natural gas business includes the transportation of natural gas through an interstate natural gas pipeline system.
– Kinetik Holdings Inc ($NASDAQ:KNTK)
Kinetik Holdings Inc is a publicly traded company with a market capitalization of 1.54 billion as of 2022. The company has a return on equity of 5.46%. Kinetik Holdings is engaged in the business of providing a range of energy storage solutions. The company’s products are used in a variety of applications including automotive, residential, commercial and industrial.
– Keyera Corp ($TSX:KEY)
Keyera Corp is a Canadian company that owns and operates energy infrastructure assets. Its business segments include natural gas gathering and processing, natural gas liquids (NGL) extraction and fractionation, transportation, storage and marketing, and power generation. The company has a market cap of 6.31B as of 2022 and a Return on Equity of 17.57%.
Summary
Kinder Morgan is a midstream yield stock that has seen a 6.8% drop in share price recently. Despite this decline, investors should consider buying the stock for three reasons. Firstly, Kinder Morgan has a strong track record of consistent dividend payouts, offering investors a steady income stream. Secondly, Kinder Morgan’s balance sheet is strong and able to weather market downturns, meaning the stock should remain resilient in bear markets.
Finally, the company has taken steps to reduce its debt levels, making it a safer investment than other midstream companies. Thus, investors should consider buying Kinder Morgan’s stock despite the recent price decline.
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