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Kinder Morgan, Inc. Message Board

  • mktplyr517 mktplyr517 Aug 13, 2014 12:55 PM Flag

    Consider EPD vs KMI

    EPD is about to split and will trade about $38-$39 and will pay about a 3.7 tax differed distribution...

    KMI will pay a taxable 5% and trade in the same range

    The biggest difference is EPDs coverage ratio is much healthier and their cost of capital is far less...

    So if you are looking to invest in mid stream energy infrastructure where would you put your money?

    & don't talk about Kinder's promise of 10% divi growth... its just a promise... EPD could cover 10% now... and it would skyrocket their unit price driving their cost of capital lower still

    IF EPD offered to buy KMI out in a 1 for 1 with the lower distribution it would be a huge EPD win and all shareholders

    The reason KMI/KMP finds itself in this position is EPD/Dan Duncan inspired mgmt. has vastly outperformed Rich Kinder

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • I think we're back to the situation where if you're in a tax-deferred acct, KMI makes a lot of sense, and in a taxable acct, EPD makes a lot of sense. You certainly can't go wrong owning some of both.

      Can't say Duncan is any better than Kinder EXCEPT Kinder obviously blew it when he didn't jump on GP consolidation bandwagon, so this is making lemons out of lemonade. I don't EPD but I do own MMP, which is another company that consolidated the GP years ago and has never looked back.

    • outthink@att.net outthink Aug 13, 2014 7:08 PM Flag

      The consolidated KMI will have market value of $100B. EPD's market value is $70B. KMI is more likely to buy EPD than vice versa.

      • 1 Reply to outthink
      • The consolidated KMI will have market value of $100B. EPD's market value is $70B. KMI is more likely to buy EPD than vice versa
        -----------------------------------------------------
        Which is interesting because EPD has greater revenue & profit with less tax than the Kinder kingdom...

        That either makes EPD vastly undervalued... or there's a problem at Houston at the Kinder franchise valuation

        Of course some jerkwad on the street could come up with the fantasy that IF all EPDs profits were taxed at the corporate level like Kinders will be..... that EPD would then be worth $120 Billion

    • if I have to deal with a K1 I want way more than 3.7. your nuts BUY high strategy on an mlp

    • Well, 3.8% does nothing for me. Neither does 5% for that matter, I'm just here for a medium term trade. I don't see why I would want a 4% return when I could get 9% buying LINE, for example. I don't see the risk being that much greater.

      • 2 Replies to coochy.cooty
      • well if you don't know the difference between the risk between upstream and mid stream MLPs you are way out of your league in commenting on anything related to MLPs...

        Mid streams operate under long term toll taking contracts that have inflation hedged in... always sold out prior to being built

        Upstream producers have so many variables starting with commodity cost.... production costs..... trans costs when pipe is not available...... that revenue and income could be all over the place

        One of the biggest problems KMP/KMI have is they have upstream exposure

        I suggest you take a look at EPDs long term chart and IF you are looking at guaranteed retirement income whether or not that is not on the top of your list to park your money

        EPD also has a better uninterrupted history of distribution increases every Q since inception.... and actually at a faster growth rate most of the time than Kinder family units

        It would be a good Idea to run EPDs chart with both KMP and KMI to see which equity has out performed too

        oh yeah... circle back and run the EPD chart against LINE and tell me about risk!... and return

        careful when your remarks exit the same place as your farts

      • Line div only around since 2006 and moves around a lot, how safe is it?
        2014 Aug 01, 2014 Aug 07, 2014 Aug 11, 2014 Aug 14, 2014 0.2416
        2014 Jul 01, 2014 Jul 09, 2014 Jul 11, 2014 Jul 16, 2014 0.2416
        2014 May 30, 2014 Jun 05, 2014 Jun 09, 2014 Jun 12, 2014 0.2416
        2014 May 01, 2014 May 08, 2014 May 12, 2014 May 15, 2014 0.2416
        2014 Apr 01, 2014 Apr 09, 2014 Apr 11, 2014 Apr 16, 2014 0.2416
        2014 Feb 25, 2014 Mar 06, 2014 Mar 10, 2014 Mar 13, 2014 0.2416
        2014 Jan 30, 2014 Feb 06, 2014 Feb 10, 2014 Feb 13, 2014 0.2416
        2014 Jan 02, 2014 Jan 09, 2014 Jan 13, 2014 Jan 16, 2014 0.2416
        2014 Total: 1.9328

        2013 Dec 02, 2013 Dec 10, 2013 Dec 12, 2013 Dec 17, 2013 0.2416
        2013 Oct 29, 2013 Nov 06, 2013 Nov 11, 2013 Nov 14, 2013 0.2416
        2013 Oct 01, 2013 Oct 09, 2013 Oct 11, 2013 Oct 17, 2013 0.2416
        2013 Aug 30, 2013 Sep 06, 2013 Sep 10, 2013 Sep 13, 2013 0.2416
        2013 Aug 01, 2013 Aug 08, 2013 Aug 12, 2013 Aug 14, 2013 0.2416
        2013 Jul 01, 2013 Jul 08, 2013 Jul 10, 2013 Jul 15, 2013 0.2416
        2013 Apr 23, 2013 May 06, 2013 May 08, 2013 May 15, 2013 0.7250
        2013 Jan 24, 2013 Feb 05, 2013 Feb 07, 2013 Feb 14, 2013 0.7250
        2013 Total: 2.8996

        2012 Oct 23, 2012 Nov 02, 2012 Nov 06, 2012 Nov 14, 2012 0.7250
        2012 Jul 24, 2012 Aug 03, 2012 Aug 07, 2012 Aug 14, 2012 0.7250
        2012 Apr 24, 2012 May 04, 2012 May 08, 2012 May 15, 2012 0.7250
        2012 Jan 27, 2012 Feb 03, 2012 Feb 07, 2012 Feb 14, 2012 0.6900
        2012 Total: 2.8650

        2011 Oct 24, 2011 Nov 02, 2011 Nov 04, 2011 Nov 14, 2011 0.6900
        2011 Jul 26, 2011 Aug 03, 2011 Aug 05, 2011 Aug 12, 2011 0.6900
        2011 Apr 26, 2011 May 04, 2011 May 06, 2011 May 13, 2011 0.6600
        2011 Jan 28, 2011 Feb 03, 2011 Feb 07, 2011 Feb 14, 2011 0.6600
        2011 Total: 2.7000

 
KMI
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