uploads///kmis net income vs estimates

Kinder Morgan’s 2Q17 Net Income Is Expected to Be Flat


Jul. 13 2017, Updated 9:08 a.m. ET

Estimated 2Q17 net income

Analysts surveyed by Reuters expect Kinder Morgan’s (KMI) 2Q17 net income to remain flat compared to its 2Q16 income. The net income is expected to fall 16%—compared to Kinder Morgan’s 1Q17 income. The company missed net income estimates in six out of the last ten quarters.

The above graph shows Kinder Morgan’s net income estimates compared to its adjusted net income over the last ten quarters.

The sale of 50% interest in Southern Natural Gas in 3Q16 might impact Kinder Morgan’s year-over-year performance in 2Q17. Lower commodity prices could have a negative impact on Kinder Morgan’s 2Q17 results. Crude oil prices averaged $48.2 per barrel in 2Q17—compared to $51.8 in 1Q17. However, the prices improved from an average of $45.4 per barrel in 2Q16. Crude oil prices impact Kinder Morgan’s CO2 segment.

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On the other hand, increased contributions from expansion projects are expected to have a positive impact on Kinder Morgan’s bottom line. Overall, these factors are expected to offset and result in flat net income for Kinder Morgan in 2Q17. In the next part, we’ll take a deeper look at Kinder Morgan’s expected segmental performance.

Kinder Morgan’s dividends

Kinder Morgan announced a cash dividend of $0.125 per share for 1Q17—unchanged from the previous quarter. Kinder Morgan also expects to declare dividends of $0.50 per share for 2017. So, investors aren’t expecting a dividend increase this quarter.

Enterprise Products Partners (EPD) announced a 1.2% increase in its 2Q17 per unit distribution compared to the previous quarter. Plains All American Pipeline (PAA) announced flat distributions for 2Q17.

In the next part, we’ll see how Kinder Morgan’s segments performed recently. We’ll discuss what investors can expect in 2Q17.


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