Stock Analysis on Net

Kinder Morgan Inc. (NYSE:KMI)

This company has been moved to the archive! The financial data has not been updated since April 29, 2020.

Capital Asset Pricing Model (CAPM) 

Microsoft Excel

Rates of Return

Kinder Morgan Inc., monthly rates of return

Microsoft Excel
Kinder Morgan Inc. (KMI) Standard & Poor’s 500 (S&P 500)
t Date PriceKMI,t1 DividendKMI,t1 RKMI,t2 PriceS&P 500,t RS&P 500,t3
Jan 31, 2015 $41.05 1,994.99
1. Feb 28, 2015 $41.01 -0.10% 2,104.50 5.49%
2. Mar 31, 2015 $42.06 2.56% 2,067.89 -1.74%
3. Apr 30, 2015 $42.95 $0.48 3.26% 2,085.51 0.85%
. . . . . . .
. . . . . . .
. . . . . . .
58. Nov 30, 2019 $19.61 -1.85% 3,140.98 3.40%
59. Dec 31, 2019 $21.17 7.96% 3,230.78 2.86%
Average (R): -0.44% 0.88%
Standard deviation: 8.13% 3.45%
Kinder Morgan Inc. (KMI) Standard & Poor’s 500 (S&P 500)
t Date PriceKMI,t1 DividendKMI,t1 RKMI,t2 PriceS&P 500,t RS&P 500,t3
Jan 31, 2015 $41.05 1,994.99
1. Feb 28, 2015 $41.01 -0.10% 2,104.50 5.49%
2. Mar 31, 2015 $42.06 2.56% 2,067.89 -1.74%
3. Apr 30, 2015 $42.95 $0.48 3.26% 2,085.51 0.85%
4. May 31, 2015 $41.49 -3.40% 2,107.39 1.05%
5. Jun 30, 2015 $38.39 -7.47% 2,063.11 -2.10%
6. Jul 31, 2015 $34.64 $0.49 -8.49% 2,103.84 1.97%
7. Aug 31, 2015 $32.41 -6.44% 1,972.18 -6.26%
8. Sep 30, 2015 $27.68 -14.59% 1,920.03 -2.64%
9. Oct 31, 2015 $27.35 $0.51 0.65% 2,079.36 8.30%
10. Nov 30, 2015 $23.57 -13.82% 2,080.41 0.05%
11. Dec 31, 2015 $14.92 -36.70% 2,043.94 -1.75%
12. Jan 31, 2016 $16.45 $0.125 11.09% 1,940.24 -5.07%
13. Feb 29, 2016 $18.09 9.97% 1,932.23 -0.41%
14. Mar 31, 2016 $17.86 -1.27% 2,059.74 6.60%
15. Apr 30, 2016 $17.76 $0.125 0.14% 2,065.30 0.27%
16. May 31, 2016 $18.08 1.80% 2,096.95 1.53%
17. Jun 30, 2016 $18.72 3.54% 2,098.86 0.09%
18. Jul 31, 2016 $20.33 $0.125 9.27% 2,173.60 3.56%
19. Aug 31, 2016 $21.85 7.48% 2,170.95 -0.12%
20. Sep 30, 2016 $23.13 5.86% 2,168.27 -0.12%
21. Oct 31, 2016 $20.43 $0.125 -11.13% 2,126.15 -1.94%
22. Nov 30, 2016 $22.20 8.66% 2,198.81 3.42%
23. Dec 31, 2016 $20.71 -6.71% 2,238.83 1.82%
24. Jan 31, 2017 $22.34 $0.125 8.47% 2,278.87 1.79%
25. Feb 28, 2017 $21.31 -4.61% 2,363.64 3.72%
26. Mar 31, 2017 $21.74 2.02% 2,362.72 -0.04%
27. Apr 30, 2017 $20.63 $0.125 -4.53% 2,384.20 0.91%
28. May 31, 2017 $18.76 -9.06% 2,411.80 1.16%
29. Jun 30, 2017 $19.16 2.13% 2,423.41 0.48%
30. Jul 31, 2017 $20.43 $0.125 7.28% 2,470.30 1.93%
31. Aug 31, 2017 $19.33 -5.38% 2,471.65 0.05%
32. Sep 30, 2017 $19.18 -0.78% 2,519.36 1.93%
33. Oct 31, 2017 $18.11 $0.125 -4.93% 2,575.26 2.22%
34. Nov 30, 2017 $17.23 -4.86% 2,647.58 2.81%
35. Dec 31, 2017 $18.07 4.88% 2,673.61 0.98%
36. Jan 31, 2018 $17.98 $0.125 0.19% 2,823.81 5.62%
37. Feb 28, 2018 $16.20 -9.90% 2,713.83 -3.89%
38. Mar 31, 2018 $15.06 -7.04% 2,640.87 -2.69%
39. Apr 30, 2018 $15.82 $0.20 6.37% 2,648.05 0.27%
40. May 31, 2018 $16.68 5.44% 2,705.27 2.16%
41. Jun 30, 2018 $17.67 5.94% 2,718.37 0.48%
42. Jul 31, 2018 $17.78 $0.20 1.75% 2,816.29 3.60%
43. Aug 31, 2018 $17.70 -0.45% 2,901.52 3.03%
44. Sep 30, 2018 $17.73 0.17% 2,913.98 0.43%
45. Oct 31, 2018 $17.02 $0.20 -2.88% 2,711.74 -6.94%
46. Nov 30, 2018 $17.07 0.29% 2,760.17 1.79%
47. Dec 31, 2018 $15.38 -9.90% 2,506.85 -9.18%
48. Jan 31, 2019 $18.10 $0.20 18.99% 2,704.10 7.87%
49. Feb 28, 2019 $19.16 5.86% 2,784.49 2.97%
50. Mar 31, 2019 $20.01 4.44% 2,834.40 1.79%
51. Apr 30, 2019 $19.87 $0.25 0.55% 2,945.83 3.93%
52. May 31, 2019 $19.95 0.40% 2,752.06 -6.58%
53. Jun 30, 2019 $20.88 4.66% 2,941.76 6.89%
54. Jul 31, 2019 $20.62 $0.25 -0.05% 2,980.38 1.31%
55. Aug 31, 2019 $20.27 -1.70% 2,926.46 -1.81%
56. Sep 30, 2019 $20.61 1.68% 2,976.74 1.72%
57. Oct 31, 2019 $19.98 $0.25 -1.84% 3,037.56 2.04%
58. Nov 30, 2019 $19.61 -1.85% 3,140.98 3.40%
59. Dec 31, 2019 $21.17 7.96% 3,230.78 2.86%
Average (R): -0.44% 0.88%
Standard deviation: 8.13% 3.45%

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1 Data in US$ per share of common stock, adjusted for splits and stock dividends.

2 Rate of return on common stock of KMI during period t

3 Rate of return on S&P 500 (the market portfolio proxy) during period t


Variance and Covariance

Kinder Morgan Inc., calculation of variance and covariance of returns

Microsoft Excel
t Date RKMI,t RS&P 500,t (RKMI,tRKMI)2 (RS&P 500,tRS&P 500)2 (RKMI,tRKMI)×(RS&P 500,tRS&P 500)
1. Feb 28, 2015 -0.10% 5.49% 0.12 21.25 1.59
2. Mar 31, 2015 2.56% -1.74% 9.02 6.86 -7.87
3. Apr 30, 2015 3.26% 0.85% 13.69 0.00 -0.10
. . . . . . .
. . . . . . .
. . . . . . .
58. Nov 30, 2019 -1.85% 3.40% 1.98 6.38 -3.56
59. Dec 31, 2019 7.96% 2.86% 70.53 3.92 16.63
Total (Σ): 3,831.54 688.77 561.88
t Date RKMI,t RS&P 500,t (RKMI,tRKMI)2 (RS&P 500,tRS&P 500)2 (RKMI,tRKMI)×(RS&P 500,tRS&P 500)
1. Feb 28, 2015 -0.10% 5.49% 0.12 21.25 1.59
2. Mar 31, 2015 2.56% -1.74% 9.02 6.86 -7.87
3. Apr 30, 2015 3.26% 0.85% 13.69 0.00 -0.10
4. May 31, 2015 -3.40% 1.05% 8.74 0.03 -0.50
5. Jun 30, 2015 -7.47% -2.10% 49.40 8.88 20.95
6. Jul 31, 2015 -8.49% 1.97% 64.78 1.20 -8.81
7. Aug 31, 2015 -6.44% -6.26% 35.93 50.94 42.78
8. Sep 30, 2015 -14.59% -2.64% 200.25 12.41 49.86
9. Oct 31, 2015 0.65% 8.30% 1.20 55.04 8.11
10. Nov 30, 2015 -13.82% 0.05% 178.96 0.69 11.09
11. Dec 31, 2015 -36.70% -1.75% 1,314.50 6.93 95.43
12. Jan 31, 2016 11.09% -5.07% 133.07 35.43 -68.67
13. Feb 29, 2016 9.97% -0.41% 108.42 1.67 -13.45
14. Mar 31, 2016 -1.27% 6.60% 0.69 32.72 -4.74
15. Apr 30, 2016 0.14% 0.27% 0.34 0.37 -0.36
16. May 31, 2016 1.80% 1.53% 5.04 0.43 1.47
17. Jun 30, 2016 3.54% 0.09% 15.86 0.62 -3.14
18. Jul 31, 2016 9.27% 3.56% 94.31 7.19 26.04
19. Aug 31, 2016 7.48% -0.12% 62.72 1.00 -7.93
20. Sep 30, 2016 5.86% -0.12% 39.71 1.01 -6.32
21. Oct 31, 2016 -11.13% -1.94% 114.27 7.96 30.16
22. Nov 30, 2016 8.66% 3.42% 82.93 6.44 23.12
23. Dec 31, 2016 -6.71% 1.82% 39.30 0.89 -5.90
24. Jan 31, 2017 8.47% 1.79% 79.52 0.83 8.11
25. Feb 28, 2017 -4.61% 3.72% 17.37 8.07 -11.84
26. Mar 31, 2017 2.02% -0.04% 6.06 0.84 -2.26
27. Apr 30, 2017 -4.53% 0.91% 16.71 0.00 -0.12
28. May 31, 2017 -9.06% 1.16% 74.33 0.08 -2.40
29. Jun 30, 2017 2.13% 0.48% 6.63 0.16 -1.02
30. Jul 31, 2017 7.28% 1.93% 59.66 1.11 8.15
31. Aug 31, 2017 -5.38% 0.05% 24.41 0.68 4.07
32. Sep 30, 2017 -0.78% 1.93% 0.11 1.10 -0.35
33. Oct 31, 2017 -4.93% 2.22% 20.11 1.79 -6.01
34. Nov 30, 2017 -4.86% 2.81% 19.50 3.72 -8.52
35. Dec 31, 2017 4.88% 0.98% 28.28 0.01 0.55
36. Jan 31, 2018 0.19% 5.62% 0.41 22.46 3.02
37. Feb 28, 2018 -9.90% -3.89% 89.43 22.79 45.15
38. Mar 31, 2018 -7.04% -2.69% 43.48 12.73 23.52
39. Apr 30, 2018 6.37% 0.27% 46.48 0.37 -4.14
40. May 31, 2018 5.44% 2.16% 34.57 1.64 7.54
41. Jun 30, 2018 5.94% 0.48% 40.68 0.16 -2.52
42. Jul 31, 2018 1.75% 3.60% 4.83 7.41 5.98
43. Aug 31, 2018 -0.45% 3.03% 0.00 4.61 -0.01
44. Sep 30, 2018 0.17% 0.43% 0.38 0.20 -0.28
45. Oct 31, 2018 -2.88% -6.94% 5.92 61.14 19.03
46. Nov 30, 2018 0.29% 1.79% 0.54 0.82 0.67
47. Dec 31, 2018 -9.90% -9.18% 89.44 101.14 95.11
48. Jan 31, 2019 18.99% 7.87% 377.48 48.85 135.79
49. Feb 28, 2019 5.86% 2.97% 39.68 4.38 13.19
50. Mar 31, 2019 4.44% 1.79% 23.81 0.83 4.46
51. Apr 30, 2019 0.55% 3.93% 0.99 9.32 3.03
52. May 31, 2019 0.40% -6.58% 0.72 55.61 -6.31
53. Jun 30, 2019 4.66% 6.89% 26.06 36.17 30.70
54. Jul 31, 2019 -0.05% 1.31% 0.16 0.19 0.17
55. Aug 31, 2019 -1.70% -1.81% 1.57 7.23 3.37
56. Sep 30, 2019 1.68% 1.72% 4.50 0.70 1.78
57. Oct 31, 2019 -1.84% 2.04% 1.96 1.36 -1.63
58. Nov 30, 2019 -1.85% 3.40% 1.98 6.38 -3.56
59. Dec 31, 2019 7.96% 2.86% 70.53 3.92 16.63
Total (Σ): 3,831.54 688.77 561.88

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VarianceKMI = Σ(RKMI,tRKMI)2 ÷ (59 – 1)
= 3,831.54 ÷ (59 – 1)
= 66.06

VarianceS&P 500 = Σ(RS&P 500,tRS&P 500)2 ÷ (59 – 1)
= 688.77 ÷ (59 – 1)
= 11.88

CovarianceKMI, S&P 500 = Σ(RKMI,tRKMI)×(RS&P 500,tRS&P 500) ÷ (59 – 1)
= 561.88 ÷ (59 – 1)
= 9.69


Systematic Risk (β) Estimation

Microsoft Excel
VarianceKMI 66.06
VarianceS&P 500 11.88
CovarianceKMI, S&P 500 9.69
Correlation coefficientKMI, S&P 5001 0.35
βKMI2 0.82
αKMI3 -1.16%

Calculations

1 Correlation coefficientKMI, S&P 500
= CovarianceKMI, S&P 500 ÷ (Standard deviationKMI × Standard deviationS&P 500)
= 9.69 ÷ (8.13% × 3.45%)
= 0.35

2 βKMI
= CovarianceKMI, S&P 500 ÷ VarianceS&P 500
= 9.69 ÷ 11.88
= 0.82

3 αKMI
= AverageKMI – βKMI × AverageS&P 500
= -0.44%0.82 × 0.88%
= -1.16%


Expected Rate of Return

Microsoft Excel
Assumptions
Rate of return on LT Treasury Composite1 RF 4.67%
Expected rate of return on market portfolio2 E(RM) 13.79%
Systematic risk (β) of Kinder Morgan Inc. common stock βKMI 0.82
 
Expected rate of return on Kinder Morgan Inc. common stock3 E(RKMI) 12.11%

1 Unweighted average of bid yields on all outstanding fixed-coupon U.S. Treasury bonds neither due or callable in less than 10 years (risk-free rate of return proxy).

2 See details »

3 E(RKMI) = RF + βKMI [E(RM) – RF]
= 4.67% + 0.82 [13.79%4.67%]
= 12.11%