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Strategies & Market Trends : Value Investing

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To: E_K_S who wrote (52926)	12/5/2013 9:50:53 AM
From: Spekulatius	Read Replies (2) of 78715

EPB appears overvalued relative to KMR. KMR will have a slightly better yield in 2014 (based on the communicated growth assumption from Kinder) and they have better growth, at least for the time being. I think the higher growth rate for KMR could continue to some extend for a few years forward, which would make the yield gap even larger. For a new investor, the best choices are KMI and KMR to invest in the Kinder complex right now. Somewhat related, BWP won't have any distribution growth for a couple of years either and there is a risk of a cut, if this Bluegrass project (pipeline reversal) does not work out (Kinder Morgan has a competing proposal that appears to be more economical). I would rather have a distribution grower like KMR @7.5% yield than something that is almost guaranteed to be stagnant (BWP) @8.5%.

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