KMI

Kinder Morgan’s Fair Value: $29 Per Share

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Summary We are initiating institutional equity research coverage of Kinder Morgan (KMI) with a fair value estimate of $29 per share and a Very Poor dividend safety rating. Valuentum has received significant attention in recent weeks following President Brian Nelson’s articles that collectively offered 10 reasons why we expect shares of Kinder Morgan to collapse. We believe prevailing conflicts of interests from brokerage research houses and credit rating organizations have created a debt-infused stock bubble propped up by a “circular flow of unsubstantiated support.” In this article, we provide the backbone of our estimates in calculating Kinder Morgan’s intrinsic worth to further the discussion for investors. ———-  We are initiating institutional equity research coverage of Kinder Morgan with a fair value … Read more

Dear member,

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We have been blown away by the attention we’ve received from our warning on Kinder Morgan’s (KMI) valuation and dividend health. Our duty as an independent research provider has never been held in higher esteem as we outlined the prevalent hazards that reside both with sell-side research inundated with conflicts of interest and credit rating assessments that are paid for by the company. Independence will always trump biased analysis, and investors of all types have applauded us for this. We thank you. But being in the spotlight is nothing new for us. In the short history of the Dividend Cushion methodology, we have called in advance the dividend cuts on a few dozen equities: SeaDrill (SDRL), SuperValu (SVU), Roundy’s (RNDY), … Read more

5 More Reasons Why We Think Kinder Morgan’s Shares Will Collapse

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This article was originally published on valuentum.com/. “…the credit rating agencies have a lot to think about. Kinder Morgan’s investment-grade credit rating is in part supported by the firm’s ability to access the equity markets to sell its own stock. But its share price is artificially propped up by the incorrect application of dividend discount models that are using financially-engineered dividends, which themselves are in part supported by the debt raised from an investment-grade credit rating, which is then used to keep raising debt and growing the dividend…and so on.” 5 More Reasons Why We Think Kinder Morgan’s Shares Will Collapse It may feel like something’s different at our independent equity research firm, but nothing has changed in the past … Read more

Friday Evening News

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Square to Go Public According to Forbes, San Francisco based mobile payment company, Square, is expected to go public sometime in 2015. In fact, sources close to the situation report that the firm is expected to file a confidential registration statement very soon, if it hasn’t happened already. Under the JOBS Act, emerging, growing companies can file for an IPO confidentially if they meet certain requirements, including having less than $1 billion in annual revenue. Internal debate over the ideal time for the firm’s IPO has clouded the situation, as has the appointment of co-founder and CEO Jack Dorsey as Twitter’s (TWTR) interim CEO. Also this week, Square launched a new credit card and phone reader designed to allow businesses … Read more

5 Reasons Why We Think Kinder Morgan’s Shares Will Collapse

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The facts have changed at Kinder Morgan (KMI). We’re removing the company from the Dividend Growth portfolio right now! The entire position will be eliminated at $40 per share. What was once an optimistic view of the entity’s decision to de-risk by consolidating its disparate master-limited-partnership structure has now turned into fear that the firm’s equity may collapse. From its overpriced valuation to its restrictive debt load to its poor Dividend Cushion ratio that warns of tremendous risks to its dividend growth plans, Kinder Morgan may turn into one of the worst-performing companies this year and into 2016. We’re getting out…and in a hurry. Here are 5 reasons why we think Kinder Morgan’s shares will collapse. 1) The Valuation Paradigm Has … Read more

Dividend Increases for the Week Ending April 17

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Below we provide a list of firms that raised their dividends during the week ending April 17. The dividend reports of covered firms on this list will be updated shortly with the new information. To access our dividend reports use the ‘Symbol’ search box in our website header. Firms Raising Their Dividends This Week Blackstone Group (BX): now $0.89 per share quarterly dividend, was $0.78. CSX (CSX): now $0.18 per share quarterly dividend, was $0.16. Discover Financial Services (DFS): now $0.28 per share quarterly dividend, was $0.24. Donegal Group (DGICA): now $0.135 per share quarterly dividend, was $0.1315. Fidelity Southern (LION): now $0.10 per share quarterly dividend, was $0.09. General Motors (GM): now $0.36 per share quarterly dividend, was $0.30. … Read more

The Market Top?

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For those that are following along closely, you shouldn’t be surprised if the market corrects 5%-10% in the coming months. Let’s talk about this. From a technical standpoint, it may not be too far of stretch to say that we’re likely going to test the bottom of the S&P 500 (SPY) uptrend, and that could feasibly mean a drop to the 200-day moving average (blue line above). My technical alerts are telling me that with respect to the S&P 500, we’ve just dipped below the 50-day moving average, an arbitrary simple rolling average but one that is no less self-fulfilling than value investing itself. Don’t panic though. We’ve cut through the 50-day moving average many a time before during this … Read more

Transaction Alert: Saying Goodbye to Chevron…For Now

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The bottom continues to fall out of crude oil prices. The price of West Texas crude oil hit six-year lows during the trading session Monday dipping just below $43 per barrel. The world is drowning in a crude oil, and OPEC continues to produce to drive marginal US operators to the brink. The dollar is strengthening, which is exacerbating the decline in the price of this dollar-denominated commodity. The news is not “new.” We’ve been commenting on the fall of crude oil for months, and the lack of energy positions in the newsletter portfolios coupled with the bearish calls on the offshore drillers speak to how far ahead of the market we positioned readers. Remember Seadrill (SDRL)? It’s trading at … Read more

Dividend Increases for the Week Ending January 23

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Below we provide a list of firms that raised their dividends during the week ending January 23. The dividend reports of covered firms on this list will be updated shortly with the new information. To access our dividend reports use the ‘Symbol’ search box in our website header. Firms Raising Their Dividends This Week AGCO (AGCO): now $0.12 per share quarterly dividend, was $0.11. Alaska Air (ALK): now $0.20 per share quarterly dividend, was $0.125. Alexanders (ALX): now $3.50 per share quarterly dividend, was $3.25. Allete (ALE): now $0.505 per share quarterly dividend, was $0.49. Bar Harbor Bankshares (BHB): now $0.245 per share quarterly dividend, was $0.235. Cardinal Financial (CFNL): now $0.11 per share quarterly dividend, was $0.10. Collectors Universe … Read more