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Technology Stocks : KMI- a fallen high dividend yielder - for how long? -- Ignore unavailable to you. Want to Upgrade?


To: alanrs who wrote (26)8/21/2017 12:53:30 PM
From: robert b furman  Read Replies (1) | Respond to of 160
 
Hi alanrs,
I may be making a mistake - but I'm betting on the scheduled dividend increases thru 2020 to take place.

I have sold March 2018 $19.00 puts for 1.42 to 1.50 (they have traded as high as 1.64) last week.

If KMI makes good on their 60% dividend increase for 2018,then they'll be paying 80 cents in 2018.

$19.00 - 1.50 = 17.50 .80/17.50 = 4.57 dividend yield.
If they continue the 25 % increase into 2020 then the dividend yield will be 7.14% 2 and 4 months out years out.
Articles like this make me think KMI is not only already big in exporting natural gas to Mexico but they have new expansion coming on soon. If they get capacity constrainied adding additional pipe capacity is inexpensive vs buying up more right of way and easements.
Natural gas exports to Mexico, which have been increasing across the U.S. border since 2010, reached near-record highs this year through May, averaging 4.04 billion cubic feet per day, up from an average of 3.78 billion in 2016. The U.S. had an energy trade surplus with Mexico of more than $11 billion last year. The value of U.S. energy exports to Mexico in 2016 was more than twice the value of the energy imports.



The U.S. is emerging as a net natural gas exporter with exports exceeding imports in three of the first five months of this year, putting the U.S. on course to reverse 60 straight years during which the nation was a net importer.



At least 17 pipelines carry more than 4 billion cubic feet of natural gas daily to Mexico, with four additional cross-border pipelines to be completed over the next two years and many more planned after that. While the U.S. still is a net gas importer from Canada, exports to eastern Canada have steadily increased since the completion of the Vector Pipeline in 2000.

The story has been similar for liquefied natural gas, or LNG. Last year, Cheniere Energy Inc. shipped the first cargoes from its Sabine Pass terminal in Louisiana, marking the start of LNG exports from the lower 48 states. Sabine Pass averaged a record 1.96 billion cubic feet per day of exports in May, according to the EIA. Numerous domestic LNG export projects are in development by companies such as Dominion Energy Inc.

There’s been a gradual and sustained increase of exploration activity in Mexico, particularly in deepwater regions. The number of active offshore exploration rigs in Mexico reached a 10-year high in June 2017, and the sector may be only just beginning to see the effects of the energy reforms. Mexico began deregulating the industry in 2013 amid declining domestic gas production.

Bob