KMI vs. WMB: Which Natural Gas Dividend Comes Out on Top?
Two natural gas pipeline giants are sending steady dividend checks to shareholders, but a closer look at growth rates, payout coverage, and streak length separates a C+ performer from an A- contender in the same sector.
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Two natural gas pipeline giants just cut checks to shareholders, and the fine print reveals why they deserve very different dividend grades. Kinder Morgan (NYSE:KMI | KMI Price Prediction) sent investors $0.2975 per share on August 17, 2026, while Williams Companies (NYSE:WMB) most recently paid $0.525 per share on June 29, 2026, with another $0.525 payment scheduled for September 28. Same sector, same customer base, same natural gas tailwinds. Very different scorecards.
The gap comes down to growth rate, payout coverage, and streak length. One is compounding faster and covering the payout more comfortably. The other is running a tighter payout ratio with slower raises. Here is the grading.
Kinder Morgan Scorecard: Solid Yield, Sluggish Raises
KMI’s latest quarterly dividend of $0.2975 annualizes to $1.19 per share, an increase of 2% over 2025. CFO David Michels framed it plainly on the Q2 2026 call: “We’re declaring a quarterly dividend of 29.75 cents per share, which is $1.19 annualized and an increase of 2% over 2025.” With shares at $32.10, the forward yield sits in the high-3% range.
KMI generated $3.45 billion of cash flow from operations year to date against $1.315 billion paid in dividends, while running 3.6 times net debt to adjusted EBITDA, comfortably below the 4.0 times target midpoint. The operating story is strong: adjusted EBITDA rose 12% and adjusted EPS rose 32% year over year. Executive Chairman Rich Kinder called the payout “solid and growing” and noted the company has paid out over $40 billion in dividends over its history.
The catch: a 2% raise is barely keeping pace with inflation, and the payout ratio against 2026 adjusted EPS guidance of $1.36 is tight. Grade: C+. Reliable, cash-covered, but not compounding fast enough to earn a higher mark.
Williams Companies Scorecard: Longer Streak, Bigger Raises
WMB’s quarterly dividend stepped up to $0.525 in 2026 from $0.5 across 2025, an annualized $2.10 per share, up 5% from $2.00. That is more than double KMI’s growth rate. Williams is also working on its 52nd consecutive year of dividend payments, a streak that predates the shale era (if that kind of multi-decade raise streak is what you screen for, we ranked ten Dividend Kings by valuation in a free report here).
WMB guided to 2026 EPS of $2.20 to $2.38 and raised full-year adjusted EBITDA guidance to $8.3 billion to $8.5 billion. CEO Chad Zamarin told investors: “We are raising full-year 2026 EBITDA guidance by $200 million at the midpoint and we are increasing our long-term EBITDA growth rate target to 11 plus percent compound annual growth through 2030.” Q2 EBITDA was up 6% over 2025, and up 10% year to date.
The wart is leverage. Year-end debt to EBITDA is expected around 3.9 times following the $5.5 billion Momentum Midstream acquisition, higher than KMI. Porter conceded: “This leverage issue is really just a 26 and 27 issue.” Grade: A-. Faster growth, longer streak, credible reinvestment runway, with a temporary balance-sheet drag.
Why the Sector Backdrop Favors Both Payouts
Both dividends look well-supported by the sector backdrop. The EIA forecasts Henry Hub prices averaging about $3.50/MMBtu in 2026 with LNG exports averaging 17.0 Bcf/d this year and 18.2 Bcf/d in 2027. Long-term, power sector gas demand is projected to reach 38.1 Bcf/d to 50.4 Bcf/d in 2050, compared with 35.2 Bcf/d in 2025. KMI is developing capacity to serve more than 10 BCF per day of natural gas demand in power generation and approximately 3 BCF per day in LNG. Williams’ Transco Power Express was upsized to an 800 million cubic feet per day expansion.
What to Watch Next
For KMI holders, the question is whether management accelerates dividend growth beyond 2% as the backlog converts. With a $9.6 billion project backlog and shares up 20.13% year to date, capital allocation choices become louder. For WMB, watch leverage: if the $5.34 billion Power Innovation joint venture deleverages the balance sheet as promised into 2028, the A- grade has room to move higher. Same sector, different report cards.
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Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics. Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications. A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.
