S&P Capital IQ Maintains STRONG BUY Rating on LP Units of Kinder Morgan Energy Partners

October 18 00:00 2011

NEW YORK, October 18 (RainbowNewsLine.com) – Analyst Tanjila Shafi of S&P Capital IQ reiterates STRONG BUY rating on LP units of Kinder Morgan Energy Partners (NYSE: KMI). The target price is set to $88.

Analyst Tanjila Shafi, in a research note published yesterday mentions that Kinder Morgan Inc. (NYSE: KMI) has declared that it has signed the final agreement to buy all the outstanding shares of El Paso (NYSE: EP) for 38 billion. The deal is valued at $26.87 per EP share based on KMI’s closing price as on 14 Oct. Since KMP is owned by KMI, the analyst is positive that this pending acquisition will benefit KMP from future EP drop downs. The analyst retains the target price at $88, and based on forward distribution estimates the target yield at 5.2% which is in line with its peers in the industry.