Goldman Sachs analyst John Mackay reiterated a Buy rating on Thursday on the shares of Kinder Morgan Inc KMI with a price forecast of $31.00.

The analyst anticipates first-quarter EBITDA of $2.18 billion, slightly above consensus estimates of $2.14 billion and company guidance of $2.17 billion.

Analysts project EBDA of $1.54 billion in the first-quarter, up from $1.43 billion in fourth-quarter FY24, driven by contributions from the Outrigger acquisition, higher natural gas prices, and seasonal marketing benefits.

Given stronger LNG demand and an improving gas macro environment, this quarter marks a shift where market fundamentals support execution, unlike 2024, when lower commodity prices posed challenges.

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Kinder Morgan anticipates the first-quarter to benefit from higher commodity prices, marking a shift after four consecutive quarters of weaker-than-expected pricing in FY24.

While only 5% of KMI’s business is directly impacted by commodity fluctuations, improved gas and crude pricing could provide a $50 million tailwind, partially offset by weaker D3 RIN prices, which may result in a $25 million headwind if trends persist.

Kinder sees substantial natural gas demand growth between 2024 and 2030, with LNG exports accounting for most of the projected increase.

While power sector growth and coal-to-gas switching contribute, LNG remains the dominant driver. KMI’s 45-50% market share in LNG exports and power plant connections position it to capitalize on expansion, particularly in Texas, Louisiana, and the southern U.S.

The company is expected to shift its focus from large-scale projects to smaller sized developments in the coming months.

While 2024 saw billion-dollar projects like SSE4, MSX, and Trident, future announcements will likely range from hundreds of millions to $500 million.

Larger expansions, such as scaling up Trident’s capacity, remain possibilities, with updates expected throughout 2025, noted the analyst.

Price Action: KMI shares traded lower by 0.30% at $28.15 at last check Friday.

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