Why Is Kinder Morgan (KMI) Up 7.8% Since Last Earnings Report?

It has been about a month since the last earnings report for Kinder Morgan (KMI). Shares have added about 7.8% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Kinder Morgan due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts. Kinder Morgan Q3 Earnings Miss EstimatesKinder Morgan reported third-quarter 2024 adjusted earnings per share of 25 cents, which missed the Zacks Consensus Estimate of 27 cents. The bottom line was flat year over year.Total quarterly revenues of $3.7 billion missed the Zacks Consensus Estimate of $3.8 billion. The top line decreased from $3.9 billion in the prior-year quarter.The weak quarterly results were primarily due to lower contributions from the Products Pipelines and CO2 business segments.Dividend HikeKinder Morgan announced a quarterly cash dividend of 28.75 cents per share for the third quarter of 2024 (annualized dividend of $1.15), implying a 2% increase from the third-quarter 2023 level. The dividend is payable on Nov. 15, 2024, to shareholders of record as of Oct. 31, 2024.Segmental AnalysisNatural Gas Pipelines: In the September-end quarter, adjusted earnings before depreciation, depletion and amortization expenses, including the amortization of the excess cost of equity investments (EBDA), increased to $1.28 billion from $1.19 billion a year ago. The segment's performance benefited from increased contributions from the Texas Intrastate system and additional inputs from the STX Midstream acquisition. However, this was partially offset by reduced contributions from gathering systems due to asset divestitures and lower commodity prices.Product Pipelines: The segment’s EBDA in the third quarter was $277 million, down from $313 million recorded a year ago. Lower commodity prices and the associated impact on inventory used to support crude and condensate business primarily affected the segment’s performance.Terminals:  Kinder Morgan generated quarterly EBDA of $267 million from the segment, higher than the year-ago period’s $259 million. Liquid terminal expansions and higher rates on Jones Act tankers boosted Terminals. Additionally, the bulk business benefited from increased petroleum coke and fertilizer volumes. CO2: The segment’s EBDA was $162 million, down from the year-ago quarter’s $175 million. The underperformance was primarily due to lower CO2 sales volumes.Operational HighlightsExpenses related to operations and maintenance totaled $790 million, up from $738 million registered a year ago. Total operating costs, expenses, and other expenditures fell to $2,684 million from $2,969 million.Distributable Cash Flow (DCF)Kinder Morgan’s third-quarter DCF was $1.09 billion compared with $1.09 billion a year ago.Balance SheetAs of Sept. 30, 2024, KMI reported $108 million in cash and cash equivalents. At the quarter's end, its long-term debt amounted to $29.8 billion.GuidanceFor 2024, Kinder Morgan projected a net income of $2.7 billion ($1.22 per share), up 15% from the 2023 level. It plans to declare dividends of $1.15 per share, up 2% from the previous figure. The company also projected DCF of $5 billion and Adjusted EBITDA of $8.16 billion, both up 8% year over year.However, due to lower commodity prices and delays in RNG facilities, Kinder Morgan now expects Adjusted EBITDA and Adjusted EPS to be about 2% and 4% below budget, respectively. Despite this, full-year Adjusted EBITDA and EPS are expected to rise 5% and 9%, respectively, with a Net Debt-to-Adjusted EBITDA ratio of 4.0x.How Have Estimates Been Moving Since Then?It turns out, estimates revision flatlined during the past month.VGM ScoresAt this time, Kinder Morgan has a subpar Growth Score of D, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookKinder Morgan has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.Must-See: Solar Stocks Poised to SkyrocketThe solar industry stands to bounce back as tech companies and the economy transition away from fossil fuels to power the AI boom.Trillions of dollars will be invested in clean energy over the coming years – and analysts predict solar will account for 80% of the renewable energy expansion. This creates an outsized opportunity to profit in the near-term and for years to come. But you have to pick the right stocks to get into.Discover Zacks’ hottest solar stock recommendation FREE.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 Kinder Morgan, Inc. (KMI): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks