Stock of the Day

January 25, 2023

ONEOK (OKE)

$80.09
-$1.49 (-1.8%)
Market Cap: $51.36B

About ONEOK

ONEOK, Inc. engages in gathering, processing, fractionation, storage, transportation, and marketing of natural gas and natural gas liquids (NGL) in the United States. It operates through four segments: Natural Gas Gathering and Processing, Natural Gas Liquids, Natural Gas Pipelines, and Refined Products and Crude. The company owns natural gas gathering pipelines and processing plants in the Mid-Continent and Rocky Mountain regions; and provides midstream services to producers of NGLs. It also owns NGL gathering and distribution pipelines in Oklahoma, Kansas, Texas, New Mexico, Montana, North Dakota, Wyoming, and Colorado; terminal and storage facilities in Kansas, Nebraska, Iowa, and Illinois; NGL distribution pipelines in Kansas, Nebraska, Iowa, Illinois, and Indiana; transports refined petroleum products, including unleaded gasoline and diesel; and owns and operates truck- and rail-loading, and -unloading facilities connected to NGL fractionation, storage, and pipeline assets. In addition, the company transports and stores natural gas through regulated interstate and intrastate natural gas transmission pipelines, and natural gas storage facilities. Further, it owns and operates a parking garage in downtown Tulsa, Oklahoma; and leases excess office space and rail cars. Additionally, the company transports, stores, and distributes refined products, NGLs, and crude oil, as well as conducts commodity-related activities, including liquids blending and marketing activities. It serves integrated and independent exploration and production companies; other NGL and natural gas gathering and processing companies; crude oil and natural gas production companies; utilities; industrial companies; natural gasoline distributors; propane distributors; municipalities; ethanol producers; petrochemical, refining, and marketing companies; and heating fuel users, refineries, and exporters. ONEOK, Inc. was founded in 1906 and is headquartered in Tulsa, Oklahoma.

ONEOK Bull Case

Here are some ways that investors could benefit from investing in ONEOK, Inc.:

  • The current stock price is around $81, showing a slight increase recently, which may indicate positive market sentiment.
  • Institutional investors own a significant portion of the company, with over 69% of the stock held by hedge funds and other institutions, suggesting strong confidence in the company's future.
  • Recent analyst ratings have been generally positive, with a consensus rating of "Moderate Buy" and an average price target of approximately $103.14, indicating potential for price appreciation.
  • ONEOK, Inc. reported a solid revenue figure of $6.49 billion in its latest quarterly earnings, demonstrating strong operational performance despite missing some earnings estimates.
  • The company has a relatively stable debt-to-equity ratio of 1.35, which indicates a balanced approach to leveraging its capital for growth while managing risk.

ONEOK Bear Case

Investors should be bearish about investing in ONEOK, Inc. for these reasons:

  • The company missed analysts' earnings estimates in its latest report, which could raise concerns about its profitability and operational efficiency.
  • ONEOK's stock has experienced volatility, with a 12-month high of $118.07 and a low of $75.48, indicating potential risks associated with price fluctuations.
  • Analysts have recently adjusted their price targets downward, with some estimates dropping from $101.00 to $91.00, which may reflect a more cautious outlook on the stock's performance.
  • The company's quick ratio of 0.52 suggests that it may face challenges in meeting short-term liabilities, which could be a red flag for investors focused on liquidity.
  • Despite a strong market presence, the overall economic environment and regulatory changes in the utilities sector could pose risks to future growth and profitability.
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