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Kinetik Holdings Inc. (NASDAQ:KNTK), a midstream energy company with a market capitalization of $7.1 billion and annual revenue of $1.58 billion, announced a significant financial development on May 30, 2025, with the entry into a new revolving credit agreement. According to InvestingPro analysis, the company’s current financial health score is rated as "GOOD," despite trading above its Fair Value. This agreement, disclosed in a recent SEC filing, establishes a $1.6 billion senior unsecured revolving credit facility. The arrangement includes a $200 million sublimit for letters of credit and a $300 million sublimit for swingline loans. As of the date of the agreement, Kinetik Holdings LP, a subsidiary of Kinetik Holdings Inc., has borrowed $465 million under this facility. With existing total debt of $3.75 billion and a current ratio of 0.66, InvestingPro data indicates that short-term obligations exceed liquid assets, making this new facility particularly significant for the company’s liquidity management.
The revolving credit facility allows for borrowings in the form of base rate loans or term SOFR loans, with interest rates varying based on the company’s credit rating. The facility is set to mature on May 30, 2030, although adjustments to this date may occur as stipulated in the agreement. The obligations under this facility are guaranteed by Kinetik Holdings Inc.
In conjunction with this development, Kinetik Holdings LP also entered into a term loan credit agreement with Toronto Dominion (Texas) LLC, providing an additional $1.15 billion in senior unsecured credit. This term loan is scheduled to mature on May 30, 2028, and is similarly guaranteed by the parent company.
Both agreements include customary covenants and restrictions, such as maintaining a certain ratio of consolidated net indebtedness to EBITDA, not exceeding 5.00 to 1.00, with a temporary allowance for a higher ratio during designated acquisition periods. The agreements also outline standard events of default that could render outstanding amounts immediately payable.
These new agreements replace previous credit facilities that were terminated on May 30, 2025. The terminated facilities included a revolving credit agreement and a term loan credit agreement, both dated June 8, 2022.
This information is based on a statement from a recent SEC filing by Kinetik Holdings Inc.
In other recent news, Kinetik Holdings Inc. reported first-quarter 2025 earnings that did not meet analysts’ expectations, with earnings per share at $0.05 versus the forecast of $0.36, and revenue at $443.26 million compared to the anticipated $477.05 million. Despite this, the company demonstrated a 7% year-over-year growth in adjusted EBITDA, reaching $250 million. Analyst firms have adjusted their outlooks on Kinetik, with RBC Capital Markets lowering the stock price target to $55 from $57, while maintaining an Outperform rating, and Citi upgrading the stock from Neutral to Buy, though also reducing the price target to $55 from $58. Goldman Sachs also adjusted its price target to $54 from $61, maintaining a Buy rating, and noted that Kinetik’s first-quarter earnings slightly exceeded its estimates, particularly in gas processing and gathering margins. Analysts from Citi and Goldman Sachs foresee potential growth for Kinetik, with expectations of a 10% EBITDA compound annual growth rate through 2029 and 2030, respectively, supported by strategic projects and cost-saving initiatives. Kinetik’s management remains optimistic, maintaining their EBITDA guidance for 2025, despite acknowledging a potentially softer macroeconomic environment. Additionally, Kinetik has announced a $500 million share repurchase program, which could be fully utilized by the end of 2027, reflecting confidence in the company’s future growth prospects.
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