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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
160 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
160You and me both JB. Good to HAVE YOU POSTING HERE! Bobrobert b furman-July 25
159Hi Bob, <i>20's coming our way?</i> Touched there briefly lastmiraje-July 25
158Hi miraje, So far an earnings beat and better guidance is moving the stock upwarobert b furman-July 25
157AH response is basically ho hum... Kinder Morgan Announces Dividend of $0.2775 miraje1July 20
156Small boost in the divi as well. Stock down 2 cents after hours..miraje-April 20
155Kinder Morgan tops profit estimates on higher jet fuel, LNG volumes (Reuters) -accountant1April 20
154Going to be big business if they land Europe and throw out restrictive legislatirobert b furman-March 25
153Seems like I've heard kinder talk about the older Louisiana port as well. Grobert b furman-March 8
152Didn't realize KMI had this contract from 2014 KMI signs transportation andE_K_S-March 8
151To all on thread: KMI has recently had a golden cross. The 50 day has crossed robert b furman3March 8
150BOUT TIME - I SAY! Bobrobert b furman-March 6
149KMI made the 5-day gainers list on Barchart. KMI +10.37%; other pipeline compE_K_S-March 6
148Yes, I saw that Blackrock investment. They have been sniffing at REITs w/ 2 buyE_K_S-February 23
147It is always wise to follow the big money: Bobrobert b furman-February 23
146Williams Increases Quarterly Cash Dividend 02/01/2022 TULSA, Okla.--(BUSINESS E_K_S-February 2
145One time gains helping to beat the estimate may be keeping the stock down. MesJohnny Canuck-January 21
144Kinder beats on earnings and revenue: Anticipates dividend grorobert b furman4January 20
143Permian needs more pipelines for gas transfer or oil production will be constrairobert b furman2January 20
142More proof that the articles detailing KMI's stagnant revenue growth is, arerobert b furman312/11/2021
141Hi E_K_S, No problemo, Texas will pick up the slack. This once again shows horobert b furman312/9/2021
140PBA canceled their LNG Facility project. They could not get the State permits E_K_S-12/9/2021
139Nopeno growth to be found here. Keep on moving folks , nothing to see here: Frobert b furman-12/9/2021
138Palantir and Kinder Morgan Sign Multi-Year Agreement to Strengthen Pipeline OperE_K_S-12/2/2021
137Hi candsrr, Yup, I have sold a lot of puts on KMI out into December thru June. robert b furman112/1/2021
136Hello to all on thread Back at you, Bob. Thanks for the heads-up. I added a lcandsrr-12/1/2021
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