Kinder Morgan (NYSE:KMI – Get Free Report) and South Bow (NYSE:SOBO – Get Free Report) are both energy companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, valuation, profitability, analyst recommendations, institutional ownership, risk and dividends.
Dividends
Kinder Morgan pays an annual dividend of $1.17 per share and has a dividend yield of 4.1%. South Bow pays an annual dividend of $2.00 per share and has a dividend yield of 7.6%. Kinder Morgan pays out 100.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. South Bow pays out 108.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Kinder Morgan has increased its dividend for 1 consecutive years.
Profitability
This table compares Kinder Morgan and South Bow’s net margins, return on equity and return on assets.
Net Margins | Return on Equity | Return on Assets | |
Kinder Morgan | 16.67% | 8.11% | 3.62% |
South Bow | N/A | N/A | N/A |
Analyst Recommendations
Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
Kinder Morgan | 0 | 7 | 7 | 0 | 2.50 |
South Bow | 2 | 8 | 1 | 2 | 2.23 |
Kinder Morgan currently has a consensus price target of $30.29, indicating a potential upside of 6.00%. South Bow has a consensus price target of $28.60, indicating a potential upside of 8.89%. Given South Bow’s higher possible upside, analysts clearly believe South Bow is more favorable than Kinder Morgan.
Valuation & Earnings
This table compares Kinder Morgan and South Bow”s revenue, earnings per share (EPS) and valuation.
Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
Kinder Morgan | $15.10 billion | 4.20 | $2.61 billion | $1.16 | 24.63 |
South Bow | $2.12 billion | 2.58 | $316.00 million | $1.85 | 14.20 |
Kinder Morgan has higher revenue and earnings than South Bow. South Bow is trading at a lower price-to-earnings ratio than Kinder Morgan, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
62.5% of Kinder Morgan shares are held by institutional investors. 12.7% of Kinder Morgan shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Summary
Kinder Morgan beats South Bow on 13 of the 17 factors compared between the two stocks.
About Kinder Morgan
Kinder Morgan, Inc. operates as an energy infrastructure company primarily in North America. The company operates through Natural Gas Pipelines, Products Pipelines, Terminals, and CO2 segments. The Natural Gas Pipelines segment owns and operates interstate and intrastate natural gas pipeline, and storage systems; natural gas gathering systems and natural gas processing and treating facilities; natural gas liquids fractionation facilities and transportation systems; and liquefied natural gas gasification, liquefaction, and storage facilities. The Products Pipelines segment owns and operates refined petroleum products, and crude oil and condensate pipelines; and associated product terminals and petroleum pipeline transmix facilities. The Terminals segment owns and/or operates liquids and bulk terminals that stores and handles various commodities, including gasoline, diesel fuel, renewable fuel and feedstocks, chemicals, ethanol, metals, and petroleum coke; and owns tankers. The CO2 segment produces, transports, and markets CO2 to recovery and production crude oil from mature oil fields; owns interests in/or operates oil fields and gasoline processing plants; and operates a crude oil pipeline system in West Texas, as well as owns and operates RNG and LNG facilities. It owns and operates approximately 82,000 miles of pipelines and 139 terminals. The company was formerly known as Kinder Morgan Holdco LLC and changed its name to Kinder Morgan, Inc. in February 2011. Kinder Morgan, Inc. was incorporated in 2006 and is headquartered in Houston, Texas.
About South Bow
South Bow Corp is a strategic liquids pipeline company. It is a new liquids-focused midstream infrastructure company. South Bow Corp is based in Canada.
Receive News & Ratings for Kinder Morgan Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Kinder Morgan and related companies with MarketBeat.com's FREE daily email newsletter.