Kinder Morgan’s lackluster performance is unwarranted contends Merrill Lynch
Bank of America Merrill Lynch notes that stock price of Kinder Morgan Inc. is down by over 30% since the beginning of current year. The sell side firm compares the performance with Alerian MLP, which fell by 32%. Kinder Morgan to some extent is vulnerable to various factors that have caused to the mid-stream energy industry’s selloff, mainly falling commodity prices. The firm reaffirms its rating of Buy, and $44 of price target on Kinder Morgan stock.
The sell side firm still sees the energy company as a better name and sees its performance as, unnecessary. The sell side firm further points out the difference between company’s year to date stock price retract and a simple 2% down revision in company’s 2016 analysts forecast for EBITDA
As per Merrill Lynch’s point of view, the company’s direct commodity compassion is around completely restricted to its business of carbon dioxide and is convenient on a combined basis. Kinder Morgan’s requirement for the expected future will largely be fulfilled by at-the-market equity issuances. The sell side firm doesn’t predict any sort of equity offerings in its model.
Track record for Kinder Morgan’s merger & acquisition has not been good since its merger with Kinder Morgan Management LLC & Kinder Morgan Energy Partners LP, earlier in November last year. The only considerable deal declared since then was Hiland Partners acquisition by Kinder Morgan, which was bit costly with a long term probable return. The company remains amid the competitive acquirers of mid-stream companies and its assets as the master limited partnership landscape still deals with the volatility.
Out of twenty analysts covering the stock of Kinder Morgan, 16 gave it a Buy, while only 3 suggested a Hold rating. The twelve month stock price target is $43.13, which shows an upside prospective of 50.1% compared to current share price of $28.64.
Kinder Morgan Inc. is an energy company located in North America. The company works through 6 divisions; namely, Product pipelines, Terminals, Natural Gas Pipelines, Kinder Morgan Canada, CO2 and other. The Gas Pipeline division includes interstate and intrastate pipelines and its LNG terminals.
The Kinder Morgan stock price has fell 29.83% in the past 200 days, and is following a downward trend. In the last 50 & 100 days the stock price has dropped 25.32% and 35.3%, respectively.
Bank of America stock news reveals that the stock was down 2.55% to $15.48 at Monday September 28 market close.
No comments:
Post a Comment