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Technology Stocks
KMI- a fallen high dividend yielder - for how long?
An SI Board Since March 2016
Posts SubjectMarks Bans Symbol
108 49 0 KMI
Emcee:  robert b furman Type:  Moderated
Kinder Morgan is the countries largest pipeline company in the US.

It has recently reduced its dividend to be able to internally fund and expand its operations - primarily the transporting of natural gas.

With the natural gas resources growing from the innovation of fracking technologies there is a mega trend at work with increasing uses of natural gas.

These growth areas are the result of four long term growth categories:

Electrical generation that is replacing coal fired plants with that of natural gas
Exporting of Natural gas to Mexico
Industrial use of natural gas in making hydro carbon based products
The exporting of LNG to world markets.

KMI currently has the largest distribution network in the US.

KMI sees a huge growing demand for more pipelines to serve the above four growth sectors.

The need for additional capital has forced a reduction of the dividend so that funds can be raised internally.

The application of these funds have been diverted from dividend streams to future growth projects.

I propose that after the expansion phase of their pipeline system is accomplished a strong dividend policy will be reintroduced.

To accumulate KMI shares during this stock price weakness is an opportunistic, but long term investment that will pay dividends into the long term future at above market yields.

The price weakness started when KMI announced it was buying (along with Brookfield Infrastructure)the remaining assets of the troubled Natural Gas Pipeline of North America:

Kinder Morgan, Inc. ( KMI) and Brookfield Infrastructure Partners L.P. (NYSE: BIP, TSX: BIP.UN) today announced a definitive agreement whereby they will jointly acquire, from Myria Holdings, Inc., the 53 percent equity interest in Natural Gas Pipeline Company of America LLC (NGPL) not already owned by them for a total purchase price of approximately $242 million. KMI will pay approximately $136 million and increase its ownership interest from 20 percent to 50 percent, and Brookfield Infrastructure will pay approximately $106 million and increase its ownership from approximately 27 percent to 50 percent. The transaction values NGPL at a total enterprise value of $3.4 billion, inclusive of existing debt.

Kinder Morgan, Brookfield Infrastructure to Acquire Myria Holdings Inc.'s Majority Interest in Natural Gas Pipeline Company of America

At this point Standard and Poors has put KMI on a credit watch and that has caused the reduced dividend - which was needed to shore up KMI credit rating.

This is where present and future LNG ports to export LNG are located - well within KMI'S pipeline presence.

This is a description of the assets bought by KMI and Brookfield:

One can easily see that Kinder has added to their existing network a 9200 mile pipeline that is well situated to grow Mexico exports and LNG exports as well as electrical generation plants and industrial plants for converting hydrocarbons to many products.

Once again this is a long term plan, and huge in scope.

It will be a long term dividend growth retirement plan for me.

I encourage others to join in the study of this expansion and critique weaknesses that may be mentioned.

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ReplyMessage PreviewFromRecsPosted
108Hi E_K_S, I keep adding to my position. The number of big projects coming on srobert b furman-July 23
107Kinder Morgan slips after posting Q2 GAAP loss, DCF/share dips Y/Y Jul. 22, 2020E_K_S-July 23
106Kinder Morgan EPS beats by $0.01, misses on revenue Jul. 22, 2020 4:08 PM ET|AboE_K_S-July 23
105FERC was busy today . . FERC clears Kinder Morgan to begin Elba LNG Unit 8 serE_K_S-July 17
104You see it the way I see it. Also, what other things can be moved in/on thoseE_K_S-July 9
103Hi E_K_S, What are your thoughts on what ramifications could a BK customer haverobert b furman-July 9
102In for a few more KMI at $14.43/share. Small Buys w/ next larger Buys at/near $E_K_S-July 9
101Hi EKS, My average is $17.03. I have swapped a lot of Cohu for KMI. KMI is nowrobert b furman-June 18
100I picked more KMI up last week at $15.75/share got my avg cost to $15.85/share aE_K_S-June 18
99LNG exports growing to China and Turkey - has to be good for the largest owner orobert b furman-June 18
98So I got out of DHT with a small profit. I just got nervous holding ahead of eagypsees-May 4
97Thanks! Bobrobert b furman-May 1
96No kidding banks pay diddly squat these days. Less than 3% I think. So anythingypsees-May 1
95WWW is wednesday. I'm thinking down into tuesday, wednesday at the latest. robert b furman-May 1
94I am holding 2 stocks over. One was an impulse buy but a real cheapie but I do gypsees-May 1
93Hi Gypsees, Tough day for going up - last two days. I'm watching till at lrobert b furman-May 1
92Thanks Bob. Turns out I should not have paid much attention to that list. I togypsees-May 1
91Hi Gypsees, I'v had KMI a long time and "got kindered" with the drobert b furman5April 23
90I liked this company very much and had it on my short list. But it was includedgypsees-April 23
89Solid free cash flow and megatrend supports what they do in the long run. Naturrobert b furman-April 22
88I picked up some KMI earlier this week. Was Buying WMB earlier this month at abE_K_S-April 22
87Hi E_K_S, For my money, the 5% dividend raise is dandy. I feel even better tharobert b furman-April 22
86Kinder Morgan posts narrow Q1 miss, raises dividend less than projected Apr. 22,E_K_S-April 22
85In for a few more KMI @ $14.51/share. Would like to add more at these prices buE_K_S1April 20
84Kinder Morgan, Energy Transfer rally after insider buys Mar. 2, 2020 10:58 AM ETE_K_S-March 2
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