Here's Why Kinder Morgan (KMI) Fell More Than Broader Market

In the latest close session, Kinder Morgan (KMI) was down 1.12% at $33.65. This change lagged the S&P 500's 0.4% loss on the day. On the other hand, the Dow registered a gain of 0.11%, and the technology-centric Nasdaq decreased by 0.73%.

The oil and natural gas pipeline and storage company's stock has climbed by 2.28% in the past month, falling short of the Oils-Energy sector's gain of 10.64% and outpacing the S&P 500's loss of 7.34%.

Market participants will be closely following the financial results of Kinder Morgan in its upcoming release. On that day, Kinder Morgan is projected to report earnings of $0.37 per share, which would represent year-over-year growth of 8.82%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.51 billion, up 6.33% from the year-ago period.

For the full year, the Zacks Consensus Estimates are projecting earnings of $1.39 per share and revenue of $17.75 billion, which would represent changes of +6.92% and +4.82%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Kinder Morgan. Such recent modifications usually signify the changing landscape of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

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, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 2.82% higher. Kinder Morgan is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, Kinder Morgan is holding a Forward P/E ratio of 24.41. This valuation marks a premium compared to its industry average Forward P/E of 20.22.

We can additionally observe that KMI currently boasts a PEG ratio of 3.12. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Oil and Gas - Production and Pipelines industry had an average PEG ratio of 1.73 as trading concluded yesterday.

The Oil and Gas - Production and Pipelines industry is part of the Oils-Energy sector. At present, this industry carries a Zacks Industry Rank of 160, placing it within the bottom 35% of over 250 industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

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Kinder Morgan, Inc. (KMI): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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