The p/e is not necessarily the right valuation metric for this stock. They have very large non-cash deductions for depreciation & amortization which are far in excess of maintenance capital expenditure needs, so cash flow is very strong compared to accounting earnings. This stock is probably more accurately valued on a DCF basis.
Actually, the tax rules for goodwill are a little more complex. Goodwill is almost always created in an acquisition scenario. When that happens, for GAAP purposes the acquiror adjusts the asset values of the target to equal the purchase price. If there is an excess of purchase price over the value assigned to identifiable assets, the excess is assigned to goodwill. Goodwill is not amortized for GAAP purposes, but it must be valued (appraised) annually to determine whether it has been impaired.
Quite often, however, the goodwill asset doesn't exist for tax purposes and there is no tax amortization or other write-off available. For example, when a company acquires another company, for tax purposes the acquiring company generally does not get to adjust (or "step up") the asset basis of the target. For GAAP purposes, however, an acquiror almost always recognizes an asset step-up. For goodwill to be recognized for tax purposes, the acquiror must directly purchase assets of the business being acquired - not the stock of the company that owns the assets (there are some exceptions, such as the §338(h)(10) election, but that is way beyond a basic explanation).
If there is a goodwill asset for tax purposes, it is amortized over a 15-year life. The deduction is not changed or affected by a GAAP goodwill impairment charge.
Well said, and probably true from your perspective - which I assume is that of a short-term trader.
But from a different perspective - that of a long-term investor - KMI is a phenomenal value right now. It definitely will gain 120%, and much more, over the next several years and in the meantime it will pay a decent, and likely growing, dividend. I've been buying over the last couple weeks and now hold shares with an average cost of $13.81 for a 3.6% yield on my cost basis. Plus the business is fundamentally sound and largely unaffected by oil prices.
To each his own...