KMI
Kinder Morgan, Inc.
$34.43
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 66.7% above fair value
You pay
$34.43
Bear
$16.53
Fair
$20.66
Bull
$24.79
Bear
$16.53
-52.0%
$1.37 × 12x P/E
Fair
$20.66
-40.0%
$1.37 × 15x P/E
Bull
$24.79
-28.0%
$1.37 × 18x P/E
Adjust Assumptions
15.1x
1.37$
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
25.1x
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (34 analysts)
$38.00
Divergence from AlphaVal
46%
Summary
Applying a 15x P/E to adjusted EPS of $1.37, the base-case value is $20.66 per share. DDM cross-check: $18.31.
Warnings
The company pays out 86% of its profits as dividends. That leaves little cushion — the dividend could be cut if business slows down.
Wall Street's average price target is $38.00 (from 34 analysts). Our estimate is 46% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples