Definitive Analysis
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Definitive Analysis

Financial Statements

Ticker

Industry

Sector

Kinder Morgan, Inc. (KMI)

Company Dividend Discount ModelIndustry: Oil & Gas MidstreamSector: Energy

Valuation Snapshot

Stable Growth$18.06 - $33.55$24.41
Multi-Stage$32.64 - $35.79$34.18
Blended Fair Value$29.30
Current Price$28.31
Upside3.49%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS3.40%3.81%1.151.141.131.101.060.970.730.500.501.90
YoY Growth--1.11%1.00%2.50%3.43%9.20%33.68%44.46%0.18%-73.53%140.00%
Dividend Yield--4.03%6.18%6.44%5.81%6.38%6.99%3.63%3.35%2.31%10.64%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)2,727.00
(-) Cash Dividends Paid (M)2,592.00
(=) Cash Retained (M)135.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)545.40340.88204.53
Cash Retained (M)135.00135.00135.00
(-) Cash Required (M)-545.40-340.88-204.53
(=) Excess Retained (M)-410.40-205.88-69.53
(/) Shares Outstanding (M)2,222.002,222.002,222.00
(=) Excess Retained per Share-0.18-0.09-0.03
LTM Dividend per Share1.171.171.17
(+) Excess Retained per Share-0.18-0.09-0.03
(=) Adjusted Dividend0.981.071.14
WACC / Discount Rate6.23%6.23%6.23%
Growth Rate0.75%1.75%2.75%
Fair Value$18.06$24.41$33.55
Upside / Downside-36.20%-13.78%18.53%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)2,727.002,774.772,823.372,872.832,923.152,974.353,063.58
Payout Ratio95.05%94.04%93.03%92.02%91.01%90.00%92.50%
Projected Dividends (M)2,592.002,609.382,626.572,643.572,660.352,676.922,833.81

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate6.23%6.23%6.23%
Growth Rate0.75%1.75%2.75%
Year 1 PV (M)2,432.262,456.402,480.54
Year 2 PV (M)2,282.092,327.622,373.59
Year 3 PV (M)2,140.952,205.332,270.99
Year 4 PV (M)2,008.292,089.222,172.57
Year 5 PV (M)1,883.621,978.982,078.15
PV of Terminal Value (M)61,773.3264,900.4168,152.87
Equity Value (M)72,520.5375,957.9579,528.71
Shares Outstanding (M)2,222.002,222.002,222.00
Fair Value$32.64$34.18$35.79
Upside / Downside15.29%20.75%26.43%

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