Is Kinder Morgan A Buy Now For A Dividend Growth Investor?

I started buying shares in Kinder Morgan (NYSE:KMI) since January 2014 with my starter position bought at $36. So far, it has done well for me as a dividend growth investor. Its quarterly dividend grew from $0.41 per share to $0.45 per share, which is an annual growth of 9.75%. Not too shabby for a starting yield of 4.56% and 14.4% unrealized gains. Adding on dips would have added to the profitability of this position.

Summary

  • Kinder Morgan’s price is 3.5% away from its 52-week high. Is it a buy now?
  • Its dividends are expected to grow 10% a year through to 2020. That is $3.22 per share of dividends by the end of 2020.
  • Based on a 4.5% yield, Kinder Morgan will reach $71.58 by the end of 2020.
  • It’s reasonable to expect Kinder Morgan to have annualized returns of more than 13.5% with Monday’s closing price of around $41.20.
  • Kinder Morgan is truly an income growth machine.

My last article on “What I’m Doing With My Kinder Morgan Shares As A Dividend Growth Investor” was when it announced the merger of the 4 companies. Now, this is an update amidst the low oil price from a dividend growth investor perspective, whether as a holder or as a buyer at the current price.

To find out more how low oil price is affecting Kinder Morgan and its dividend and expected dividend growth, check out my full article at Seeking Alpha: Is Kinder Morgan a Buy Now for a Dividend Growth Investor?

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Disclosure: At time of writing, I’m long KMI.

Disclaimer: I am not a certified financial advisor. This article is for educational purposes, so consult a financial advisor and or tax professional if necessary before making any investment decisions.

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