Why Kinder Morgan Inc Is the Best Buy in the Pipeline Sector
Kinder Morgan (NYSE: KMI) has been a rather abysmal investment since it reemerged on to the public seen in 2011 from a leveraged buyout in 2007. Overall, the stock is down more than 20% even after factoring in dividends. Driving the decline has been the impact of the legacy leverage from that privatization, as well as the additional debt it took on when it gobbled up its MLPs in 2014. The consequence of that leverage came to a head in late 2015 as the worsening oil market downturn forced the company to slash its dividend so it could protect its coveted investment-grade credit rating.
However, since that time Kinder Morgan has undertaken several strategic initiatives that have vastly improved its financial situation. As a result, the company is back on solid ground and has visible growth prospects ahead of it that have the potential to create tremendous value for investors as the energy market begins to heal. That upside, when combined with several other factors, makes it the best buy in the sector in my opinion.
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Source: Fool.com
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