Thursday, October 22, 2015

Kinder Morgan Warns On Dividend Growth, Investors Saddened, Stock Drops 7% (KMI)

That's over a years worth of divi's in one morning.
Oh, did we catch some flack when we and FT Alphaville's Izabella Kaminska said some unflattering things about this one.
The stock is down 6.79% at $29.29.

From Barron's Income Investing:

Kinder Morgan Points to Slower Dividend Growth, Disappoints Investors
Fans of Kinder Morgan (KMI), which reported third quarter earnings after the close October 21, are none too happy Thursday morning. 
While results generally met expectations and KMI raised its quarterly dividend, the company pointed to slower dividend growth in 2016. It expects to increase its dividend in the 6%-10% range instead of the 15% growth it has posted so far in 2015.The stock, already down 30% in the past six months, was set to fall another 5% at the open Thursday to around $29.80. 
Tristan Richardson of SunTrust Robinson Humphrey is just one of the analysts who cut his price target, lowering it to $38 from $48. He scaled back his 2016 growth forecast, reducing his 2016 earnings before depreciation and amortization (EBDA) estimate by nearly a billion to $7.885 billion from $8.765 billion. But he maintains his Buy rating, writing to clients: 
In the current environment, we continue to see Kinder Morgan as a long term opportunity and one of the better positioned midstream infrastructure firms in the space given its high level of connectivity, diverse asset and customer base, and its leverage to a growing natural gas transportation market. 
Charlie Smith, manager of the Fort Pitt Capital Total Return Fund (FPCGX) says he’s maintaining his long-term position in KMI, but expressed disappointment in the management team. “Reducing the dividend growth forecast is a black mark,” he told Barron’s. “Over promising and under delivering is not something you want to do on Wall Street.”...MORE
Most recently we linkd to Income Investing's Oct. 12 warning "Why Kinder Morgan May Need to Lower Its Dividend Guidance".
If interested see also Oct. 4's post: "Chasing Yield: September Was the Worst Month In History For Master Limited Partnerships".

KMI Kinder Morgan, Inc. daily Stock Chart
The week the 2014 roll-up was announced the stock jumped and then settled around $41.