Kinder Morgan Energy Partners LP (KMP) Primed for Robust Growth

With a reported net income of $446 million, TransCanada Corporation (USA) (NYSE:TRP) has surpassed the comparable earnings ($370 million) for the first quarter. With its Bruce Power Units one and two on again, in addition to Bruce Power unit four and Sundance, which are back in service, TransCanada seems well positioned to report strong growth with its yearly earnings growth estimated at around 16.7% and 13.31% for the fiscal 2013 and 2014, respectively.

However, at present its Keystone project is under doubt due to various environmental issues. Nonetheless, ongoing projects such as Coastal GasLink from the Dawson Creek area to the West Coast of British Colombia and extension of NOVA Gas Transmission Systems, TransCanada Corporation (USA) (NYSE:TRP) certainly proposes a reliable long-term investment opportunity.

Enbridge Inc (USA) (NYSE:ENB) exhibited robust performance during the first quarter of 2013 with adjusted earnings at around $488 million. Earlier this year, the company announced its plans for a $200 million pipeline for new oil sands project.

The new pipeline is expected to connect Athabasca Oil’s planned Hangingstone oil sands project in northern Alberta to its regional pipeline network. The massive 50-Kilometer pipeline will carry approximately 16,000 barrels per day of crude oil by 2015.

It must be noted that, earlier this year, Enbridge Inc (USA) (NYSE:ENB) also entered into a joint venture with Energy Transfer in order to develop a Trunkline gas-to-oil conversion and reversal project that connects the East Coast Gulf refinery market to the Patoka, Illinois, hub. Such efforts are expected to bolster its revenues and earnings in the future.

Bottom line

The cancellation of its Freedom Pipeline project enabled Kinder Morgan Energy Partners LP (NYSE:KMP) in delivering a dividend-pay-out ratio of 508%. In addition to this, shareholders of the company should be pleased with estimated year-over-year earnings pegged at around 12.77% and 8.54%, respectively, for the next two fiscal years.

I believe Kinder Morgan Energy Partners LP (NYSE:KMP) is primed to attain a strong upside in its share price, as its the largest midstream company with huge investments in the pipeline infrastructure coupled with new found shale deposits in North America. I believe Kinder Morgan Energy Partners will witness robust growth through the utilization of its assets in the long run.

The article Kinder Morgan Energy Partners Primed for Robust Growth originally appeared on Fool.com and is written by Ashit Gulati.

Ashit Gulati and Equity Dimensions have no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.
Ashit is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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