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Kinder Morgan (KMI) Stock Sinks As Market Gains: Here's Why

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Kinder Morgan (KMI - Free Report) ended the recent trading session at $27.42, demonstrating a -0.07% swing from the preceding day's closing price. The stock's performance was behind the S&P 500's daily gain of 0.05%. Meanwhile, the Dow experienced a drop of 0.17%, and the technology-dominated Nasdaq saw an increase of 0.4%.

The oil and natural gas pipeline and storage company's shares have seen an increase of 12.05% over the last month, surpassing the Oils-Energy sector's gain of 5.9% and the S&P 500's gain of 5.75%.

The investment community will be paying close attention to the earnings performance of Kinder Morgan in its upcoming release. The company is predicted to post an EPS of $0.33, indicating a 17.86% growth compared to the equivalent quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $3.97 billion, down 1.7% from the prior-year quarter.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $1.17 per share and a revenue of $15.15 billion, indicating changes of +9.35% and -1.17%, respectively, from the former year.

It is also important to note the recent changes to analyst estimates for Kinder Morgan. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.84% lower within the past month. Kinder Morgan is holding a Zacks Rank of #3 (Hold) right now.

With respect to valuation, Kinder Morgan is currently being traded at a Forward P/E ratio of 23.37. This denotes a premium relative to the industry's average Forward P/E of 17.24.

It is also worth noting that KMI currently has a PEG ratio of 3.97. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. By the end of yesterday's trading, the Oil and Gas - Production and Pipelines industry had an average PEG ratio of 3.51.

The Oil and Gas - Production and Pipelines industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 159, putting it in the bottom 37% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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