Artificial Intelligence (AI) and More Give Kinder Morgan a Robust Backlog. Is the Stock a Buy?

Kinder Morgan (NYSE: KMI) recently reported solid fourth-quarter results and issued 2025 guidance. Nevertheless, most notable from the report was the increasing project backlog the corporate was seeing because of this of natural gas demand coming for LNG (liquefied natural gas) exports, power plants, and artificial intelligence (AI).

Let us take a look at the pipeline company’s most up-to-date results and guidance to see if that is an excellent time to purchase the stock.

Certainly one of the most important things to come back out of Kinder Morgan’s latest earnings report was the corporate’s growing project backlog. Its project backlog increased a whopping 60% in comparison with its third quarter, going from $5.1 billion to $8.1 billion. Projects related to natural gas accounted for 89% of its backlog.

In expects the EBITDA multiple on most of its projects (those not related to carbon dioxide enhanced oil recovery) to be 5.8 times. Because of this for each $100 million it spends, it expects to generate an incremental $17.24 million in EBITDA from these projects. Midstream projects are sometimes done between 6x to 8x EBITDA multiples, so it is a very solid expected return on these projects.

Kinder Morgan highlighted three big natural gas projects it has recently secured: South System Expansion 4, Mississippi Crossing, and the Trident Intrastate Pipeline. The corporate said it is rather well positioned for the trends driving natural gas volumes, with it serving 45% of the LNG export demand, 50% of natural gas exports to Mexico, and 45% of the facility demand within the desert Southwest, Texas, and Southeast regions. It also noted that we’re still within the very early innings of AI data centers and the facility needed for them.

It sees natural gas demand within the U.S. rising by 28 billion cubic feet (BCF) a day by 2030. This projection could be very much like the 28.5 BCF a day increase that natural gas producer Antero Resources recently provided. While U.S. natural gas consumption has step by step been increasing, these projections are near doubling recent consumption inside five years, which could be an infinite increase.

Turning to its results, Kinder Morgan’s adjusted earnings per share (EPS) jumped 14% to $0.32. That was just under analyst expectations for EPS of $0.34.

It adjusted EBITDA, meanwhile, rose 7% to $2.06 billion. Its distributable money flow (DCF), which is working money flow minus maintenance capital expenditures (capex), climbed by 8% to $1.26 billion. Its DCF per share rose 10% to $0.57. Adjusted EBITDA and DCF are two of probably the most common metrics used to judge midstream firms.

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