KMI's historical earnings week pattern indicates a price reversal, and current signals support a bearish case. While the stock return this week is flat, a notable drop in short interest suggests weakness ahead. The model combines neutral price action with bearish short interest momentum, increasing downside risk.

Historically KMI has reversal in the stock price the week of earnings. In this case the stock return is essentially 0.

In addition, the change in short position is predicative in that when it is negative the stock price goes down.

In this case the stock forecast is neutral, and the short forecast is bearish as the short interest return is -14%.

The stock moves 2% on earnings amid the implied move is 5% The forecast move is large compared to these moves.

The short interest has been going down for a while which is bearish.

Kinder Morgan faces a conflicting earnings setup with flat price action but sharply falling short interest, which has historically led to negative returns. Given the stock's usual 2% earnings move and an implied move of 5%, the current forecast signals heightened downside potential and risk for long positions.

Want to know more? Access this data in real time using S3’s BLACK APP

The information herein (some of which has been obtained from third party sources without verification) is believed by S3 Partners, LLC (“S3 Partners”) to be reliable and accurate. Neither S3 Partners nor any of its affiliates makes any representation as to the accuracy or completeness of the information herein or accepts liability arising from its use. Prior to making any decisions based on the information herein, you should determine, without reliance upon S3 Partners, the economic risks, and merits, as well as the legal, tax, accounting, and investment consequences, of such decisions.