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Kinder Morgan Insider Buy A Sign Of A Dividend Hike?

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Kinder Morgan Insider Buy A Sign Of A Dividend Hike?
  • An insider has bought shares of the largest energy infrastructure company in North America.
  • The purchase comes after earnings and as investors watch for a dividend hike.
  • Insider buying can be seen as a good sign for investors.

Conventional wisdom says that insiders and 10 percent owners really only buy shares of a company for one reason -- they believe the stock price will rise and they want to profit from it. So insider buying can be an encouraging signal for potential investors, particularly during periods of uncertainty. Case in point: recent notable buy at Kinder Morgan Inc (NYSE: KMI).

A director at this Houston-based energy infrastructure giant purchased 700,000 shares this week. The share price for that purchase was $21.41, bringing the total to around $14.99 million. In the wake of the recent third-quarter earnings report, analysts and investors alike are looking for Kinder Morgan to hike its dividend.

Kinder Morgan has a market capitalization of more than $47 billion and a dividend yield near 2.3 percent. Short interest tumbled earlier this month to 1.2 percent of the float. Shares retreated more than 12 percent leading up to the earnings report, but began to recover afterward, closing most recently at $21.49, still near the director's purchase price.

The stock is up more than 42 percent year-to-date.

 

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