Here's Why Hold Strategy is Apt for Kinder Morgan Stock Now

Kinder Morgan, Inc. KMI is a well-known name in the midstream energy space. The Zacks Consensus Estimate for its earnings for 2025 is pegged at $1.27 per share, suggesting a year-over-year improvement of 10.4%.What’s Favoring KMI?Kinder Morgan operates an extensive network of pipelines spanning 79,000 miles, transporting natural gas, gasoline, crude oil and carbon dioxide. The company also owns 139 terminals that store a variety of products, including renewable fuels, petroleum products, chemicals and vegetable oils.Being a leading midstream service provider, Kinder Morgan’s pipeline and storage assets are secured under long-term take-or-pay contracts. These contracts ensure that shippers pay for the capacity reserved, whether they utilize it or not, which provides a steady stream of revenues. This structure allows Kinder Morgan to generate stable earnings insulated from fluctuations in the volume of natural gas transported, offering significant stability to its bottom line.The demand for natural gas in the United States is anticipated to grow, backed by several important factors. As the nation shifts toward cleaner energy, natural gas is being increasingly utilized as a transitional fuel, given its cleaner-burning properties compared to coal and oil, which result in lower carbon emissions. Moreover, the rise in industrial activity and the growing demand for electricity, particularly from gas-powered plants, fuel this demand. Additionally, the expansion of natural gas exports as liquefied natural gas to satisfy global energy needs boosts domestic demand.As a leading transporter of natural gas, Kinder Morgan, carrying a Zacks Rank #3 (Hold), is well-positioned to benefit from the growing demand for natural gas, which enhances its earnings. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Notably, KMI has unveiled an ambitious $2.5 billion per year expansion capital investment strategy, reinforcing its commitment to industry leadership. This level of investment is essential for funding new pipeline projects, increasing storage capacity and enhancing infrastructure to meet growing natural gas demand.  Risks to Kinder Morgan’s BusinessHowever, such high capital intensity presents both opportunities and risks. Also, there has been a slowdown in drilling activities, as upstream players mainly focus on stockholder returns rather than boosting output. This could affect demand for midstream assets. Other midstream players that might also be adversely impacted include The Williams Companies Inc. (WMB), Enterprise Products Partners LP EPD and Enbridge Inc. ENB.Having ownership and operating interests in pipeline networks spanning 33,000 miles, The Williams Companies transports natural gas from the prolific basins in the United States to the end market.Enterprise Products, a top-tier North American midstream service provider, boasts a vast and diversified asset portfolio. This includes more than 50,000 miles of pipelines and a storage capacity of 300 million barrels.Enbridge is also a midstream energy player in North America, operating an extensive crude oil and liquids transportation network spanning 18,085 miles — the world's longest and most complex system.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.3% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Enterprise Products Partners L.P. (EPD): Free Stock Analysis Report Enbridge Inc (ENB): Free Stock Analysis Report Kinder Morgan, Inc. (KMI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks