We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Kinder Morgan (KMI) Lags on Q4 Earnings, Ups '24 EPS Guidance
Read MoreHide Full Article
Kinder Morgan, Inc. (KMI - Free Report) reported fourth-quarter 2023 adjusted earnings per share of 28 cents, missing the Zacks Consensus Estimate of 31 cents. The bottom line declined from the year-ago quarter’s earnings of 31 cents.
Total quarterly revenues of $4,038 million beat the Zacks Consensus Estimate of $3,961 million. However, the top line declined from $4,579 million in the prior-year quarter.
Weak quarterly earnings were primarily driven by a decline in realized weighted natural gas liquid price. Quarterly earnings were also impacted by the milder winter conditions observed in 2023.
Kinder Morgan, Inc. Price, Consensus and EPS Surprise
Natural Gas Pipelines: In the December-end quarter, adjusted earnings before depreciation, depletion and amortization expenses, including the amortization of the excess cost of equity investments (EBDA), declined to $1,330 million from $1,353 million a year ago. The segment was mainly affected by the milder winter conditions experienced in 2023.
Product Pipelines: The segment’s EBDA in the fourth quarter was $278 million, reflecting an increase from $252 million a year ago. Higher volumes of jet fuel primarily aided the segment.
Terminals: Through the segment, Kinder Morgan generated quarterly EBDA of $266 million, higher than the year-ago period’s $244 million. Higher average charter rates aided the outperformance.
CO2: The segment’s EBDA was $170 million, down from the year-ago quarter’s $194 million. The underperformance was caused by a decline in realized weighted natural gas liquids prices.
Operational Highlights
Expenses related to operations and maintenance totaled $745 million, up from $695 million a year ago. Yet, total operating costs, expenses and others were down to $2,937 million from $3,475 million.
Distributable Cash Flow (DCF)
Kinder Morgan’s fourth-quarter DCF was $1,171 million compared with $1,217 million a year ago.
Balance Sheet
As of Dec 31, 2023, KMI reported $83 million in cash and cash equivalents. Its long-term debt amounted to $27,880 million at the quarter end.
Guidance
In its initial budget for 2024, KMI projected an EPS of $1.21 and DCF per share of $2.21, excluding the NextEra Energy Partners’ STX Midstream assets acquisition completed on Dec 28, 2023.
With the inclusion of the acquisition, the revised 2024 budget reveals an increased EPS of $1.22, marking a 15% rise from 2023, and DCF per share of $2.26. Adjusted EBITDA is set at $8.16 billion, an 8% increase from 2023, with a net-debt-to-adjusted EBITDA ratio of 3.9 times.
Despite these changes, KMI maintains its plan to declare dividends of $1.15 per share for 2024.
Zacks Rank & Stocks to Consider
Kinder Morgan currently carries a Zacks Rank #3 (Hold).
Sunoco LP (SUN - Free Report) is among the biggest motor fuel distributors in the U.S. wholesale market in terms of volumes. Sunoco has a core competency in terms of its history of disciplined expense management.
The Zacks Consensus Estimate for SUN’s 2024 EPS is pegged at $3.83. SUN currently has a Zacks Style Score of B for Value and Growth.
Oceaneering International, Inc. (OII - Free Report) is one of the leading suppliers of offshore equipment and technology solutions to the energy industry.
The Zacks Consensus Estimate for OII’s 2024 EPS is pegged at $1.52. OII currently has a Zacks Style Score of A for Growth, and B for Value and Momentum.
Enbridge Inc. (ENB - Free Report) is a leading energy infrastructure company. It plans to introduce more than C$19 billion in growth projects, contributing to significant EBITDA growth in the near future.
The Zacks Consensus Estimate for ENB’s 2023 and 2024 EPS is pegged at $2.13. ENB currently has a Zacks Style Score of A for Momentum.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Kinder Morgan (KMI) Lags on Q4 Earnings, Ups '24 EPS Guidance
Kinder Morgan, Inc. (KMI - Free Report) reported fourth-quarter 2023 adjusted earnings per share of 28 cents, missing the Zacks Consensus Estimate of 31 cents. The bottom line declined from the year-ago quarter’s earnings of 31 cents.
Total quarterly revenues of $4,038 million beat the Zacks Consensus Estimate of $3,961 million. However, the top line declined from $4,579 million in the prior-year quarter.
Weak quarterly earnings were primarily driven by a decline in realized weighted natural gas liquid price. Quarterly earnings were also impacted by the milder winter conditions observed in 2023.
Kinder Morgan, Inc. Price, Consensus and EPS Surprise
Kinder Morgan, Inc. price-consensus-eps-surprise-chart | Kinder Morgan, Inc. Quote
Segmental Analysis
Natural Gas Pipelines: In the December-end quarter, adjusted earnings before depreciation, depletion and amortization expenses, including the amortization of the excess cost of equity investments (EBDA), declined to $1,330 million from $1,353 million a year ago. The segment was mainly affected by the milder winter conditions experienced in 2023.
Product Pipelines: The segment’s EBDA in the fourth quarter was $278 million, reflecting an increase from $252 million a year ago. Higher volumes of jet fuel primarily aided the segment.
Terminals: Through the segment, Kinder Morgan generated quarterly EBDA of $266 million, higher than the year-ago period’s $244 million. Higher average charter rates aided the outperformance.
CO2: The segment’s EBDA was $170 million, down from the year-ago quarter’s $194 million. The underperformance was caused by a decline in realized weighted natural gas liquids prices.
Operational Highlights
Expenses related to operations and maintenance totaled $745 million, up from $695 million a year ago. Yet, total operating costs, expenses and others were down to $2,937 million from $3,475 million.
Distributable Cash Flow (DCF)
Kinder Morgan’s fourth-quarter DCF was $1,171 million compared with $1,217 million a year ago.
Balance Sheet
As of Dec 31, 2023, KMI reported $83 million in cash and cash equivalents. Its long-term debt amounted to $27,880 million at the quarter end.
Guidance
In its initial budget for 2024, KMI projected an EPS of $1.21 and DCF per share of $2.21, excluding the NextEra Energy Partners’ STX Midstream assets acquisition completed on Dec 28, 2023.
With the inclusion of the acquisition, the revised 2024 budget reveals an increased EPS of $1.22, marking a 15% rise from 2023, and DCF per share of $2.26. Adjusted EBITDA is set at $8.16 billion, an 8% increase from 2023, with a net-debt-to-adjusted EBITDA ratio of 3.9 times.
Despite these changes, KMI maintains its plan to declare dividends of $1.15 per share for 2024.
Zacks Rank & Stocks to Consider
Kinder Morgan currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector may look at some better-ranked companies mentioned below. The three companies presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Sunoco LP (SUN - Free Report) is among the biggest motor fuel distributors in the U.S. wholesale market in terms of volumes. Sunoco has a core competency in terms of its history of disciplined expense management.
The Zacks Consensus Estimate for SUN’s 2024 EPS is pegged at $3.83. SUN currently has a Zacks Style Score of B for Value and Growth.
Oceaneering International, Inc. (OII - Free Report) is one of the leading suppliers of offshore equipment and technology solutions to the energy industry.
The Zacks Consensus Estimate for OII’s 2024 EPS is pegged at $1.52. OII currently has a Zacks Style Score of A for Growth, and B for Value and Momentum.
Enbridge Inc. (ENB - Free Report) is a leading energy infrastructure company. It plans to introduce more than C$19 billion in growth projects, contributing to significant EBITDA growth in the near future.
The Zacks Consensus Estimate for ENB’s 2023 and 2024 EPS is pegged at $2.13. ENB currently has a Zacks Style Score of A for Momentum.