We recently published a list of the 15 Energy Infrastructure Stocks That Are Skyrocketing. In this article, we are going to take a look at where Kinder Morgan, Inc. (NYSE:KMI) stands against other energy infrastructure stocks that are skyrocketing.
In January 2024, the Biden administration paused federal authorizations for several pending LNG export projects, citing concerns about environmental impacts and domestic energy security. The US Department of Energy later released an assessment indicating that increased LNG exports could add 1.5 gigatons of greenhouse gas emissions annually by 2050, equivalent to a quarter of the current emissions of the US. However, President-elect Donald Trump is set to reverse the Biden administration’s pause on liquefied natural gas (LNG) export approvals, marking a significant shift in US energy policy.
On January 1, Ukraine officially halted the transit of Russian natural gas to several European nations, marking the end of a five-year agreement and closing a chapter in Russia’s decades-long dominance over Europe’s energy markets. The termination of this deal comes amidst the ongoing war between Ukraine and Russia, with neither side willing to negotiate an extension. Europe is expected to rely heavily on liquefied natural gas (LNG) imports. Christoph Halser of Rystad Energy estimates that the EU will need to source approximately 7.2 billion cubic meters of gas from the global LNG market.
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As Europe pivots away from Russian gas, the United States emerges as a key player in filling the supply gap. US LNG exports to Europe have already been rising in recent years, and this shift presents an even greater opportunity for American energy producers. With robust infrastructure and increased LNG export capacity, the U.S. is well-positioned to strengthen its role as a reliable supplier to Europe, enhancing energy security across the continent while bolstering its own energy industry.
The growth of US energy exports hinges on significant investments in infrastructure. According to a report by ICF, prepared for the American Petroleum Institute (API), the development of US oil and gas infrastructure is expected to remain robust through 2035. The report highlights that the primary drivers for continued infrastructure development remain strong. Shale and tight oil resource extraction are projected to continue at a rapid pace, supported by advancements in extraction technologies and favorable market responses to competitive commodity prices. Total capital expenditures (CAPEX) for oil and gas infrastructure are projected to range between $1.06 trillion and $1.34 trillion from 2017 to 2035. This equates to an average annual investment of $56 billion to $71 billion, spanning various infrastructure components, including surface and lease equipment, gathering and processing facilities, pipelines for oil, gas, and natural gas liquids (NGLs), storage facilities, refineries, and export terminals.
As global energy dynamics shift, the United States stands poised to play a pivotal role in ensuring energy security for Europe while driving growth in its own energy sector.
Aerial view of an oil and gas pipeline, spanning vast landscapes.
Our Methodology
To compile our list of the 15 energy infrastructure stocks that are skyrocketing, we used Finviz and Yahoo stock screeners to rank the top 15 energy infrastructure stocks that achieved the highest gains over the past six months. We also included their hedge fund sentiment, which was taken from Insider Monkey’s Hedge Fund database of 900 elite hedge funds as of Q3 of 2024. The list is sorted in ascending order of 6-month performance, as of January 2.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Kinder Morgan, Inc. (NYSE:KMI)
Returns in Past 6 Months: 41.38%
Number of Hedge Fund Investors: 42
Kinder Morgan, Inc. (NYSE:KMI) is one of the largest energy infrastructure companies in North America, specializing in the transportation and storage of natural gas, crude oil, and refined products. The company owns an extensive pipeline network and storage terminals, that serve power generation plants, industrial manufacturers, and utility companies across the continent.
Over the past six months, Kinder Morgan, Inc.’s (NYSE:KMI) stock price has increased significantly, driven by the announcement of new projects and expansions. The company has recently announced several significant projects, including the $3 billion South System Expansion 4 Project and the expansion of its Gulf Coast Express Pipeline (GCX) in Texas. Furthermore, the company is planning new projects and has a strong backlog of potential projects, with a value of over $5 billion. These projects will increase the company’s capacity to transport and store natural gas, enabling it to meet growing demand from customers.
Looking ahead, Kinder Morgan, Inc.’s (NYSE:KMI) management team sees significant growth opportunities in the natural gas sector, driven by increasing demand from power generation, industrial users, and LNG exports. The company is also exploring opportunities in the renewable energy sector, including carbon capture and storage (CCS) and renewable natural gas (RNG).
Overall, KMI ranks 12th on our list of energy infrastructure stocks that are skyrocketing. While we acknowledge the potential of KMI to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than KMI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
