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Kinder Morgan Inc.

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Kinder Morgan’s midstream properties are linked to all natural gas-rich plays in the United States. These extensive pipeline networks, for which billions of dollars have been invested, have been providing Kinder Morgan with stable fee-based revenues. The company has a strong commitment to return cash to stockholders via dividend payments and share buybacks. Through 2018, the firm expects its annualized dividend to grow 60%. Also, the midstream energy player has an ongoing program for a $2-billion share buyback. Kinder Morgan managed to report strong second-quarter 2018 results, courtesy of higher contribution from almost all of the firm’s large transmission intrastate and interstate systems. However, we are concerned about the company’s more levered balance sheet as compared to the industry. On top of that, declining project backlog is a matter of concern.

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