Kinder Morgan braces for second tough report from Hedgeye

|About: Kinder Morgan, Inc. (KMI)|By:, SA News Editor

Kinder Morgan (KMI +0.4%) could find itself on the defensive today when Hedgeye releases his second note in recent weeks critical of the company’s maintenance practices.

Richard Kinder says his companies don’t cut corners on safety and noted that, like many other MLPs, KMI/KMP/KMR records much of its maintenance work as expenses instead of capital costs, which don’t impact cash distributions.

Hedgeye's Kevin Kaiser says he stands by his original analysis, and will follow it up in today’s report; he believes Kinder eventually will need to issue debt or equity to pay for broken-down systems.

“MLPs in general are massively overvalued, and we’re going to have a correction," Kaiser believes.