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On Monday, RBC Capital Markets analyst Elvira Scotto updated the firm’s outlook on Kinder Morgan shares, increasing the price target to $27.00 from the previous $26.00. The Sector Perform rating was maintained for the energy infrastructure company listed on the New York Stock Exchange under the ticker (NYSE:KMI). Currently trading at $27.68, the stock sits within a broader analyst target range of $22 to $38, according to InvestingPro data.
The adjustment of the price target comes after Kinder Morgan’s recent corporate developments, including its fourth-quarter earnings report for 2024, its budget presentation for 2025, and details from its annual 10-K filing. With last twelve months EBITDA of $6.63 billion and a solid dividend yield of 4.24%, the company maintains strong operational performance. Despite Kinder Morgan’s Adjusted EBITDA for the fourth quarter of 2024 being slightly below what analysts had anticipated, RBC Capital sees a positive trajectory for the company.
Scotto highlighted the significant quarter-over-quarter increase in Kinder Morgan’s project backlog, which rose by approximately 60%, as a clear indicator of the company’s growth potential. This growth is attributed to the increasing demand for natural gas. InvestingPro analysis shows the company has maintained dividend payments for 15 consecutive years, with a 1.77% dividend growth in the last twelve months.
RBC Capital’s confidence in Kinder Morgan is further reinforced by the company’s financial health. Scotto noted that Kinder Morgan’s cash flow generation capabilities and its strong balance sheet position it well to fund its growth initiatives.
In the wake of these developments, RBC Capital has revised its estimates for Kinder Morgan, which has led to the higher price target for 2026. The firm’s outlook reflects an expectation of continued improvement for Kinder Morgan, driven by the energy sector’s dynamics and the company’s strategic positioning.
In other recent news, Kinder Morgan has experienced a series of significant developments. Barclays (LON:BARC) analyst Christine Cho upgraded Kinder Morgan’s stock from Equalweight to Overweight, setting a new price target of $31.00, citing the company’s solid infrastructure assets and positive outlook in the natural gas sector. Additionally, S&P Global revised Kinder Morgan’s outlook to positive from stable, affirming its ’BBB’ issuer credit rating due to the company’s strong balance sheet and strategic growth initiatives. Kinder Morgan also outlined its 2025 business plan, forecasting continued growth with a projected adjusted EBITDA increase of 5% year-over-year. The company plans to generate $5.9 billion in cash flow from operations in 2025, reinforcing its position in the energy infrastructure market.
In a strategic move, ArcLight Capital Partners (WA:CPAP) acquired a 25% stake in the Gulf Coast Express Pipeline, which is partially owned and operated by a Kinder Morgan subsidiary. This pipeline, crucial for transporting natural gas from the Permian Basin, aligns with growing demand in the LNG export market. Additionally, Kinder Morgan revised its bylaws to streamline corporate governance and shareholder engagement, introducing changes such as distinct proxy card colors to prevent confusion during stockholder solicitations. These recent developments highlight Kinder Morgan’s focus on infrastructure expansion, governance improvements, and maintaining a strong financial outlook.
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