RBC Capital Expects Kinder Morgan To Be Well Positioned To Weather The Challenging Crude Oil Price


In a research note issued after close, RBC Capital analyst Elvira Scotto maintained an Outperform rating on Kinder Morgan (NYSE:KMI) with a $45 price target, as the company provided its preliminary 2015 financial expectations. KMI’s 2015 EBDA guidance of $8.2BN was roughly in line with KMI’s pro-forma financials provided previously in its proxy statement. KMI’s expected $2.00/share in dividend outlook is in line with RBC’s expectation.

Scotto noted, “We continue to believe Kinder Morgan’s solid growth project backlog ($18BN identified) provide multi-year visible cash flow growth. KMI’s expansive footprint across different businesses and geographies provides it with a unique ability to pursue several growth opportunities that can enhance its overall growth outlook. We believe KMI should be well positioned to weather the challenging crude oil price environment given its diversified asset base (natural gas pipelines is the largest segment) and substantial fee-based cash flow.”

The analyst added, “Kinder Morgan will host its annual analyst meeting on Jan 28, 2015 in Houston, TX. We expect KMI to provide a detailed 2015 budget for its operating segments and highlight its growth initiatives.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Elvira Scotto has a total average return of 10.5% and a 64.1% success rate. Scotto has a 7.0% average return when recommending KMI, and is ranked #602 out of 3418 analysts.

 

 

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