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Kinder Morgan (KMI) is one of the largest midstream energy firms in North America, with an interest in or an operator on about 83,000 miles in pipelines and 140 storage terminals.
The company is active in the transportation, storage, and processing of natural gas, crude oil, refined products, natural gas liquids, and carbon dioxide.
The majority of Kinder Morgan's cash flows stem from fee-based contracts for handling, moving, and storing fossil fuel products.
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The company was formerly known as Kinder Morgan Holdco LLC and changed its name to Kinder Morgan, Inc. in February 2011.
Kinder Morgan, Inc. was founded in 1936 and is headquartered in Houston, Texas.
Three key data points gauge Kinder Morgan Inc or any dividend-paying firm.
The key three are:
(1) Price
(2) Dividends
(3) Returns
Those three basic keys best tell whether any company has made, is making, and will make money.
KMI Price
Over the past year, KMI’s share price fell about 2.7% from $18.72 to $17.26 as of Tuesday’s market close.
If KMI’s stock trades in the range of $16.00 to $22.00 this next year, its recent $17.26 share price might rise to $20.00 by next year. Of course, Kinder Morgan’s price could drop about the same $2.74 amount, or more.
My upside estimate of $2.74, however, is about 89% of the median of one year target prices estimated by 18 analysts tracking KMI for brokers.
KMI Dividend
Kinder Morgan Inc has paid variable quarterly dividends since May 16, 2011. KMI’s most recent quarterly dividend, paid August 15th to shareholders of record July 28th is $0.2825So, KMI’sannual dividend payout is projected to be $1.13 and yield 6.55% per Tuesday’s closing price.
KMI Returns
Adding the $1.13 anticipated annual dividend to Kinder Morgan’s estimated $2.74 possible price upside, reveals a $3.87 potential gross gain per share for the coming year.
At Tuesday’s $17.26 closing price, a little over $1000 would buy 58 shares.
A $10 broker fee (if charged), paid half at purchase and half at sale, might cost us about $0.17 per share.
Subtracting that maybe $0.17 brokerage cost from my estimated $3.87 gross gain per share makes a net gain of $3.70 X 58 shares = $214.60 or about a 21.25% net gain.
This may be the time to pounce on Kinder Morgan Inc shares. But beware, KMI is a midstream fossil fuels tranporatation. Furthermore, the estimated $65.50 dividend from $1000 invested comes in at just over 3.5 times greater than the recent single share price. The choice is yours.
Remember the true value of any stock is best realized by your personal ownership of shares.
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