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Investors eagerly await Kinder Morgan’s (NYSE:KMI) second-quarter results due Wednesday post-market hours, with a keen eye on burgeoning natural gas demand. The company is projected to unveil higher profit and revenue, amidst a backdrop of escalating aspirations for natural gas consumption.
The forthcoming earnings reveal an anticipated EPS estimate of $0.25 – marking a robust 4.2% year-over-year increase. Revenue projections stand at $4.12 billion, a substantial 17.7% growth year-over-year.
Kinder Morgan’s shares observed an uptick following the Q1 earnings release, where the firm reported adjusted earnings in line with forecast. Bolstered by augmented volumes in its natural gas pipelines division, the company’s guidance for full-year earnings per share of $1.22 trumped Wall Street estimates by $0.01.
Since the Q1 earnings, Kinder Morgan’s stock price has ascended approximately 14%, reflecting investor confidence in the company’s strategic trajectory.
CEO Kim Dang has expressed optimism regarding the escalation in natural gas demand predicted to unfold by 2030. Forecasts signal a twofold surge in liquefied natural gas exports and a substantial 50% uptick in exports to Mexico within the same timeframe.
Furthermore, after over a decade of development and investments amounting to C$34 billion, Canada’s Trans Mountain pipeline enlargement project commenced commercial operations this May.
In addition to its strategic endeavors, Kinder Morgan recently acquired oil and gas producing assets in the Permian Basin, totaling around $100 million. The company plans to capitalize on U.S. carbon capture incentives to enhance production output from these properties.
Although growth projects may momentarily strain dividend payouts, Curonian Research asserts that they will unlock value in the medium term, underpinned by emphasis on deleveraging and robust cash flows.
According to Seeking Alpha contributor Steven Fiorillo, Kinder Morgan is well-positioned to leverage opportunities ushered in by the burgeoning AI realm. The company is strategically positioned to cater to the energy needs of the approaching future.
Historically, Kinder Morgan has surpassed EPS estimates 63% of the time and revenue estimates 25% of the time over the past two years. Notably, EPS estimates witnessed 2 upward revisions and 5 downward revisions in the last three months, while revenue estimates saw 1 upward and 5 downward adjustments.
Conclusively, Seeking Alpha’s quantitative models afford Kinder Morgan a ‘Hold’ rating, signifying a cautious yet optimistic outlook aligned with the company’s performance trajectory.