Kinder Morgan, Inc.

(New York Stock Exchange)
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Bullish +75

Is Kinder Morgan Stock at $33 Undervalued in 2026? Here’s What Numbers Show - TIKR.com

AI-generated analysis

πŸ“ˆ Kinder Morgan delivered its strongest quarter in recent memory with Q1 2026 adjusted EBITDA rising 18% year-over-year to $2.54 billion.

πŸ”₯ Revenue grew 14% to $4.83 billion, beating the consensus estimate of $4.60 billion driven by record LNG feed gas deliveries.

πŸ’° The company recognized lump-sum payments from a terminal contract buyout and retroactive rate increases following a favorable court ruling.

πŸ“‰ Net debt to adjusted EBITDA ratio fell to 3.6x, the lowest leverage level since before the 2014 consolidation.

⭐ Moody's upgraded Kinder Morgan's credit rating to Baa1, equivalent to BBB+ across major agencies.

πŸ’΅ Management lifted full-year 2026 EBITDA guidance by over $250 million and reaffirmed a $1.19 annualized dividend.

πŸ—οΈ Project backlog expanded to $10.1 billion, with 92% weighted toward natural gas projects converting to EBITDA in 2027-2028.

πŸ“Š CEO Kimberly Dang described the results as a remarkable quarter with adjusted EPS up 41% and EBITDA growing by 18%.

🎯 Wall Street consensus price target is $35, implying around 9% upside from the current price of $33.

πŸš€ TIKR's mid-case model values Kinder Morgan at $41 by December 2030, implying roughly 5% annualized total return.

βš–οΈ Revenue under take-or-pay contracts grew 14%, providing a stable base business with high margins of 53%.

πŸ” KMI sits second in quarterly EBITDA among midstream peers, trailing only Energy Transfer but ahead of Williams Companies.

Bullish Signals
  • Q1 2026 adjusted EBITDA surged 18% year-over-year to $2.54 billion, driven by an 8% increase in natural gas transport volumes.
  • Revenue grew 14% to $4.83 billion, beating the consensus estimate of $4.60 billion with a 53% EBITDA margin.
  • Net debt to adjusted EBITDA ratio improved to 3.6x, the lowest since before the 2014 consolidation, strengthening the balance sheet.
  • Moody's upgraded the company's credit rating to Baa1, reflecting improved financial stability and lower risk.
  • Management lifted full-year 2026 EBITDA guidance by over $250 million, representing more than 3% above the original budget.
  • The company reaffirmed a dividend of $1.19 per share, which is up 2% from 2025 levels.
  • A $10.1 billion project backlog weighted 92% toward natural gas points to significant future EBITDA growth starting in 2027.
  • Three major gas pipeline expansions are scheduled to come online between Q1 2027 and late 2028, converting backlog into reported earnings.
  • Analyst consensus price target of $35 implies around 9% upside from the current price of $33.
  • TIKR's mid-case model values Kinder Morgan at $41 by December 2030, implying a 26% total return from current levels.
Full Analysis
Kinder Morgan (KMI) reported its strongest quarter in recent memory for Q1 2026, with adjusted EBITDA surging 18% year-over-year to $2.54 billion and revenue climbing 14% to $4.83 billion. This outperformance was driven by an 8% increase in natural gas transport volumes and a 15% rise in gathering volumes, particularly on the Haynesville system. CEO Kimberly Dang highlighted that adjusted EPS jumped 41%, marking a remarkable first quarter for the infrastructure operator. The company's financial health has significantly improved, with its net debt to adjusted EBITDA ratio falling to 3.6x, the lowest level since before the 2014 consolidation. Consequently, Moody's upgraded KMI's credit rating to Baa1. Management also lifted full-year 2026 EBITDA guidance by over $250 million and reaffirmed a dividend of $1.19 per share, which represents a 2% increase from the previous year. Looking forward, Kinder Morgan has a substantial project backlog of $10.1 billion, with 92% weighted toward natural gas projects expected to come online between Q1 2027 and late 2028. Analysts maintain a consensus price target of $35, implying roughly 9% upside from the current price of $33, while TIKR's mid-case model values the stock at $41 by December 2030, suggesting a potential 26% total return.