Benzinga - by Benzinga Insights, Benzinga Staff Writer.
On January 18, Joel V Staff, Director at Kinder Morgan (NYSE:KMI) executed a significant insider buy, as disclosed in the latest SEC filing.
What Happened: Staff made a significant move by purchasing 7,860 shares of Kinder Morgan as reported in a Form 4 filing with the U.S. Securities and Exchange Commission. The transaction's total worth stands at $140,065.
As of Thursday morning, Kinder Morgan shares are down by 0.34%, currently priced at $17.5.
Delving into Kinder Morgan's Background Kinder Morgan is one of the largest midstream energy firms in North America, with an interest in or an operator on about 83,000 miles in pipelines and 140 storage terminals. The company is active in the transportation, storage, and processing of natural gas, crude oil, refined products, natural gas liquids, and carbon dioxide. The majority of Kinder Morgan's cash flows stem from fee-based contracts for handling, moving, and storing fossil fuel products.
Understanding the Numbers: Kinder Morgan's Finances Decline in Revenue: Over the 3 months period, Kinder Morgan faced challenges, resulting in a decline of approximately -24.53% in revenue growth as of 30 September, 2023. This signifies a reduction in the company's top-line earnings. When compared to others in the Energy sector, the company faces challenges, achieving a growth rate lower than the average among peers.
Analyzing Profitability Metrics:
- Gross Margin: Achieving a high gross margin of 49.68%, the company performs well in terms of cost management and profitability within its sector.
- Earnings per Share (EPS): Kinder Morgan's EPS reflects a decline, falling below the industry average with a current EPS of 0.24.
Valuation Metrics:
- Price to Earnings (P/E) Ratio: Kinder Morgan's P/E ratio of 16.11 is below the industry average, suggesting the stock may be undervalued.
- Price to Sales (P/S) Ratio: The Price to Sales ratio is 2.48, which is lower than the industry average. This suggests a possible undervaluation based on sales performance.
- EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): A high EV/EBITDA ratio of 10.79 reflects market recognition of Kinder Morgan's value, positioning it as more highly valued compared to industry peers.
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The Relevance of Insider Transactions While insider transactions provide valuable information, they should be part of a broader analysis in making investment decisions.
In the realm of legality, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities under Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are required to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.
Notably, when a company insider makes a new purchase, it is considered an indicator of their positive expectations for the stock.
Conversely, insider sells may not necessarily signal a bearish stance on the stock and can be motivated by various factors.
Understanding Crucial Transaction Codes For investors, a primary focus lies on transactions occurring in the open market, as indicated in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C signals the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.
Check Out The Full List Of Kinder Morgan's Insider Trades.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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