The Simple Reason Why I Won't Buy Kinder Morgan, Inc. Stock

Midstream oil and gas giant Kinder Morgan, Inc. (NYSE: KMI) has announced plans to increase its dividend by an average of around 25% a year between 2018 and 2020. At first blush, that's a pretty incredible announcement, until you step back and take a look at what's actually going on: Kinder is working the dividend back from a massive 75% cut in 2016. With dividend growth back on the table, you might think that everything is fine, but that's not exactly true. Here's the simple reason I won't buy Kinder Morgan.

The dividend cut was really about access to capital to help fund Kinder's growth spending. Oil prices were low, selling stock wasn't a great option, and the company already had a lot of debt on its balance sheet. That left cutting the dividend to free up capital, which was probably the right move.

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Source: Fool.com