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Is Kinder Morgan a ‘Buy’ Ahead of Its Q1 Results?

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Nov. 20 2020, Updated 3:16 p.m. ET

Recommendations for KMI

Around 76% of Reuters-surveyed analysts have rated Kinder Morgan (KMI) as a “buy” or a “strong buy” as of April 9. The company is expected to release its first-quarter earnings results next week.

Around 19% of analysts have rated KMI as a “hold,” while 5% have rated it as a “sell.” The median price target for Kinder Morgan is $21, which implies a potential upside of ~5% from its current price.

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With an enterprise value-to-EBITDA multiple of ~10.4x, Kinder Morgan stock looks undervalued compared to its peers, which have an average multiple of ~12x. However, its forward PE multiple of ~19.6x is higher than the peer average. Based on analysts’ median price target, Kinder Morgan has a limited upside potential of 5%. However, combined with its 4% yield, the stock looks slightly attractive.

Recommendations for peers

The chart above shows analysts’ recommendations for Kinder Morgan. Among KMI’s peers, 100% of analysts have rated Enterprise Products Partners (EPD) as a “buy.” Around 89% of analysts have rated Energy Transfer (ET) as a “buy,” ~90% have rated Williams Companies (WMB) as a “buy,” and 55% have rated ONEOK (OKE) as a “buy.”

For the latest coverage on energy stocks, refer to Market Realist’s Energy and Power page.

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