UPDATE: Jefferies Initiates Coverage on Kinder Morgan with Hold Rating, $38 PT on Broad Midstream/Downstream Footprint

In a report published Wednesday, Jefferies analyst Christopher Sighinolfi initiated coverage on Kinder Morgan KMI with a Hold rating and $38.00 price target. In the report, Jefferies noted, “KMI, through KMP & EPB, boasts one the broadest midstream and downstream footprints in the US providing non-discretionary services throughout various facets of the energy value chain. While owning just 9% and 41% of BV equity in KMP & EPB, resp., KMI receives ~48% & ~58% of KMP & EPB's respective distribution payouts as both MLPs are in the 50% IDR splits. Despite a strong ~10% div CAGR through '17, we are cautious on KMI and initiating with a Hold & $38 PT.” Kinder Morgan closed on Tuesday at $37.93.