ONEOK logged a 0.5% change during today's afternoon session, and is now trading at a price of $70.23 per share.
ONEOK returned gains of 9.0% last year, with its stock price reaching a high of $71.57 and a low of $55.91. Over the same period, the stock underperformed the S&P 500 index by -6.0%. As of April 2023, the company's 50-day average price was $66.07. ONEOK, Inc., together with its subsidiaries, engages in gathering, processing, fractionation, storage, transportation, and marketing of natural gas and natural gas liquids (NGL) in the United States. Based in Tulsa, OK, the large-cap Utilities company has 2,966 full time employees. ONEOK has offered a 5.5% dividend yield over the last 12 months.
The Business Has Weak Operating Margins:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (MM) | $12,593 | $10,164 | $8,542 | $16,540 | $22,387 | $19,199 |
| Revenue Growth | n/a | -19.29% | -15.96% | 93.63% | 35.35% | -14.24% |
| Operating Margins | 15% | 19% | 16% | 16% | 13% | 19% |
| Net Margins | 12% | 16% | 9% | 9% | 8% | 13% |
| Net Income (MM) | $1,515 | $1,651 | $802 | $1,500 | $1,722 | $2,456 |
| Net Interest Expense (MM) | $470 | $492 | $713 | $733 | $676 | $727 |
| Depreciation & Amort. (MM) | $429 | $477 | $579 | $622 | $626 | $666 |
| Earnings Per Share | $2.78 | $3.07 | $1.42 | $3.35 | $3.84 | $5.46 |
| EPS Growth | n/a | 10.43% | -53.75% | 135.92% | 14.63% | 42.19% |
| Diluted Shares (MM) | 414 | 415 | 432 | 447 | 448 | 460 |
| Free Cash Flow (MM) | $45 | -$1,902 | -$296 | $1,849 | $1,704 | $2,645 |
| Capital Expenditures (MM) | $2,141 | $3,848 | $2,195 | $697 | $1,202 | $1,308 |
| Current Ratio | 0.66 | 0.73 | 1.39 | 0.75 | 0.84 | 0.97 |
| Long Term Debt (MM) | $8,873 | $12,480 | $14,228 | $12,748 | $12,696 | $21,450 |
| Net Debt / EBITDA | 4.0 | 5.31 | 7.3 | 4.34 | 3.9 | 4.93 |
A Very Low P/E Ratio but Trades Above Its Graham Number:
ONEOK has a trailing twelve month P/E ratio of 12.1, compared to an average of 17.53 for the Utilities sector. Based on its EPS guidance of $4.97, the company has a forward P/E ratio of 13.3. The company doesn't provide forward earnings guidance, and the compound average growth rate of its last 6 years of reported EPS is 11.9%. On this basis, ONEOK's PEG ratio is 1.02. Using instead the 9.0% weighted average of ONEOK's earnings CAGR and the broader market's anticipated 5-year EPS growth rate, the company's PEG ratio is 1.35, which shows that its shares might be fairly priced. In contrast, ONEOK is likely overvalued compared to the book value of its equity, since its P/B ratio of 2.51 is higher than the sector average of 1.71. The company's shares are currently trading 6.5% above their Graham number.
Analysts Give ONEOK an Average Rating of Buy:
The 17 analysts following ONEOK have set target prices ranging from $65.0 to $80.0 per share, for an average of $74.47 with a buy rating. As of April 2023, the company is trading -11.3% away from its average target price, indicating that there is an analyst consensus of some upside potential.
ONEOK has an average amount of shares sold short because 2.2% of the company's shares are sold short. Institutions own 70.4% of the company's shares, and the insider ownership rate stands at 0.46%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 10% stake in the company is worth $4,160,217,377.
