Better Buy: Enterprise Products Partners vs. Kinder Morgan
There are just a small number of really, really large midstream companies in North America that have the heft to be consolidators in an industry that's facing material growth headwinds. Two of the most notable names on the U.S. side of the border are Enterprise Products Partners (NYSE: EPD) and Kinder Morgan (NYSE: KMI). Which one is the better buy? That's a tough call; here's why.
Kinder Morgan cut its dividend in 2016 after telling investors to expect a dividend increase of as much as 10%. That has created a trust issue that I have a hard time getting past. But I also recognize that management has made great strides to earn back investor trust and, for anyone looking at the midstream space today, it deserves to be considered. In fact, at this point, there's little doubt in my mind that the company can support the dividend it's paying. If you have an open mind and can forgive past transgressions, it's worth a closer look.
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