Energy Stocks Mixed; Kinder Morgan Edging Higher After Boosting Q4 Dividend by 11% Over Prior Quarter

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Energy stocks are narrowly mixed, with the NYSE Energy Sector Index falling about 0.1% while shares of energy companies in the S&P 500 are up less than 0.1% as a group. Crude oil for February delivery is down 23 cents at $94.17 per barrel while February natural gas is up 6 cents to $4.39 per 1 million BTU.

Front-month prices for natural gas futures gave up a large part of their earlier gains after government data reported a record drop in natural gas supplies last week although the decline wasn't quite as large as market experts were expecting.

The Energy Information Agency reported a decline of 287 billion cubic feet in U.S. commercial natural gas inventories to 2.53 trillion cubic feet during the week ended Jan. 10. That narrowly topped the all-time largest week draw of 285 billion cubic feet during a cold snap last month, but lagged the market consensus looking for a draw of at least 300 billion cubic feet following last week's record cold through much of the country, according to a Platts survey.

Futures prices declined following the EIA report, natural gas for February delivery slipped from a 15-cent advance just before the 10:30 a.m. ET release to now trade around $4.39 per 1 million BTU, up about 6 cents for the session in NYMEX trade.

In company news, Kinder Morgan ( KMI ) shares rose slightly Thursday, overcoming Q4 earnings that trailed Wall Street expectations by increasing its quarterly dividend by 11% over its previous payout.

KMI earned $0.33 per share during the three months ended Dec. 31, 2013, down from a $0.34 profit in the year-ago period and missing the Capital IQ consensus by $0.02 per share. Revenue rose 25.8% year over year to $3.87 bln, matching estimates.

The company also declared a quarterly dividend of $0.41 per share, up $0.04 from its $0.37 per share dividend during the prior quarter and payable Feb. 18 to shareholders of record on Jan. 31. KMI finished 2013 with $1.713 billion available for dividends, up 21% from the end of the prior year and exceeding its published annual budget of $1.632 billion.

KMI also said it expects, subject to board approval, to reduce its ownership stakes in several partnerships this year - including its 50% interest each in Ruby Pipeline and Gulf LNG and a 47.5% percent interest in Young Gas Storage - through sales to El Paso Pipeline Partners LP ( EPB ), trimming the revenue and earnings contributions those units currently are providing the company.

Shares were up 0.3% at $35.60 each in recent trade. The stock has a 52-week range of $32.82 to $41.49 a share.

In other sector news,

(+) SGY, (+2.4%) Proved reserves at end of 2013 rise 12% over prior-year levels to 143.9 mln barrels of oil equivalent. Q4 daily production averaged around 49,800 barrels, or about 299 mln cubic feet per day, well above the company's original guidance.

(+) GLOG, (+7.0%) Liquefied natural gas shipper reverses early decline that followed pricing an upsized offering of 9.5 mln shares priced at $15.75 each. Certain directors, executives and one major shareholder also purchased $36.5 mln of shares in concurrent private placement.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing Commodities
Referenced Stocks: EPB , KMI

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