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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
138 48 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
132Kinder Morgan Delivers Steady Second-Quarter Earnings [graphic] --------------E_K_S1July 22
131Hi miraje, The revenue from the new pipeline from the Permian couldn't havrobert b furman-April 21
130Finally, some good news from KMI.. 21
129Williams will unload upstream assets it gained through producer bankruptcies WiE_K_S-February 26
128Even without Keystone XL, U.S. set for record Canadian oil imports By Nia WillE_K_S-January 22
127Hi EKS, Yup pump that green nitrogen eh? The future energy is a balance of it robert b furman1January 20
126Fwiw sold 30% of my position yesterday along w/ small amounts of WMB, CVX to redE_K_S-January 20
125KMI beats consensus by 3 cents at 27 cents and beats on revenue with 3.12 revenurobert b furman2January 20
124Well anyone who has been looking must acknowledge our world is constantly being robert b furman-January 18
123I stumbled on some research plots out in those Oil Sands where they convert thatE_K_S-January 18
122Hi E_K_S, Man, thought I was a long term investor! <smile> I guess Obamarobert b furman-January 18
121I was thinking eventually would/could see NG and/or Liquified Ammonia Gas or eveE_K_S-January 18
120Hi E_K_S, I may well have a bad impression, but I thought there was not a lot orobert b furman-January 18
119Biden may cancel Keystone XL pipeline permit as soon as his first day in office:E_K_S-January 18
118Hi E_K_S, It's not the hoped for 20 cents, but all increases in the dividenrobert b furman-12/8/2020
117Kinder Morgan sees 3% rise in 2021 dividend per share Dec. 08, 2020 8:47 AM ET KE_K_S-12/8/2020
116Maybe KMI will come up w/ similar resolution CHK resolution Williams announces E_K_S-11/23/2020
115HI E_K_S, I guess we need real time posting. LOL Looks like their guidance on robert b furman310/22/2020
114Kinder Morgan declares $0.2625 dividend Oct. 21, 2020 4:09 PM ET|About: Kinder E_K_S-10/22/2020
113Kinder Morgan EPS beats by $0.01, beats on revenue Oct. 21, 2020 4:06 PM ET|AbouE_K_S-10/22/2020
112Hi E_K_S, Saw a report that indicates oil demand increses starting from Septembrobert b furman-10/6/2020
111Winter coming so demand for NG increases . .E_K_S-10/6/2020
110Hi E_K_S, Looks like natural gas is at the 5 year average, Capex cuts are beginrobert b furman110/6/2020
109Oil pipeline operators offer new discounts as demand drops - Bloomberg Oct. 5, 2E_K_S-10/6/2020
108Hi E_K_S, I keep adding to my position. The number of big projects coming on srobert b furman-7/23/2020
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