Kinder Morgan Inc (NYSE:KMI) reported that the Utopia Pipeline system has been made operational, and product delivery of ethane from Ohio to Ontario, Canada, has started operation. The pipeline system spreads around 270 miles and has a preliminary capacity of 50,000 barrels a day and can be expanded to over 75,000 bpd.
The buzz
Don Lindley, the President of Natural Gas Liquids of Products Pipelines for Kinder Morgan, expressed that they are extremely delighted to have started the Utopia Pipeline. The project team, in support with local, federal and state agencies, has done a remarkable job developing an assignment that offers ethane takeaway capacity to the expanding petrochemical market from the Utica shale while also keeping an open conversation with the local communities to boost their requirements and consider alternatives. This creativity and interaction developed an assignment that worked for several stakeholders.
More recently, Bill Selesky, an analyst at Argus upgraded shares of company to “Buy” from “Hold” with a price target of $23. As per the article published on Benzinga, Kinder Morgan’s operational performance remains robust, while its valuation appears attractive, both relative to peers and on a historical basis. The analyst reported he’s impressed with the firm’s plan to increase its dividend considerably to $1 in 2019 from 80 cents in 2018. The planned payout increase exhibits management’s confidence in the firm’s strategy.
Argus increased its 2018 EPS projection for the firm to 74 cents a share from 70 cents a share. The firm attributed the revision to positive expectations for increased pricing in all operating divisions, lower interest expense and overall margin improvement after recent debt restructuring. Argus’ price target of $23 and anticipated dividend increase indicate a prospective return of 25% from current levels. Shares of Kinder Morgan recorded drop of 0.27% in yesterday’s trading session.
