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Kinder Morgan Inc.

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Kinder Morgan has increased its annual dividend to 80 cents per share in 2018 that proves the company’s prudence. In Oct 2015, the company was compelled to lower its dividend from 51 cents per share to 125 cents after its midstream businesses were hurt by weakness in oil and gas prices. With a lower dividend, the company was less dependent on issuing new debt and equity, which we believe eradicates financing risk for the foreseeable future. Moreover, low natural gas prices has increased its consumption in the U.S that is beneficial for the company as it has extensive natural gas transportation facilities, which is likely to be in demand from this development. However, Kinder Morgan’s stock has underperformed the broader industry, year to date. We are also concerned about the company’s weak balance sheet and it’s financing for Trans Mountain pipeline is also under threat.

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