A Big Upgrade for Kinder Morgan

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Every day, the sun rises on Wall Street, and a plethora of professional analysts wake to issue new opinions on stocks. Here at the Fool, we use our "This Just In" column to examine some of these picks-- and the track records of the firm behind them -- so individuals can make better investing decisions.

In addition to following professional banks, anyone can use Motley Fool CAPS to monitor the collective opinions of more than 140,000 members, many of whom demonstrate better investing insight than published analysts do.

After spending most of the past couple of years at a four-star rank, Kinder Morgan Energy Partners (NYSE: KMP) has swayed enough top-performing CAPS members to earn an upgrade to a more formidable five stars. A total of 1,076 members have given their opinion on the pipeline operator, with many offering analysis and commentary to explain their recent optimism.

Kinder Morgan is one of the largest pipeline transporters in North America, serving customers like Chevron (NYSE: CVX) and Total. Many CAPS members like its ability to weather the downturn, despite fallen commodities prices that did more damage to other players in the energy sector. It pulled in a strong third quarter, with lower costs and improving earnings despite weaker revenue. All but one of its businesses outperformed their 2008 third-quarter results. CAPS members like the steady business it brings in with its long-term fee-based contracts, and Kinder continues to pay a solid dividend.  

Future growth also looks good for the company. It recently beefed up its natural gas footprint with the acquisition of Crosstex Energy's (Nasdaq: XTXI) natural gas treating business, which Kinder expects to be accretive to the bottom line right away, with good growth potential foreseen. Its Fayetteville Express project, a joint venture with Energy Transfer Partners (NYSE: ETP) that it expects to complete in 2011, has commitments from Chesapeake Energy (NYSE: CHK) and BP (NYSE: BP). Its Midcontinent Express Pipeline, also in partnership with ETP, recently became fully operational, locked in with multiyear contracts. And its Rockies Express Pipeline, with partners Sempra Energy and ConocoPhillips (NYSE: COP), has nearly all of its capacity spoken for.                                            

Do you think Kinder Morgan deserves its elevated status? Add your thoughts in the comments box below on this page, or head over to CAPS to rate the company and check out all the information and opinions the community offers, absolutely free.