ONEOK
OKE
$93.76
+1.56%
ONEOK, Inc. is a diversified midstream energy service provider specializing in natural gas gathering, processing, storage, and transportation, as well as natural gas liquids (NGL) transportation and fractionation, operating primarily in the midcontinent, Permian, and Rocky Mountain regions. The company is a significant player in the North American midstream sector, distinguished by its extensive integrated pipeline network that connects key production basins to major market hubs. The current investor narrative is driven by robust earnings growth, raised forward guidance, and the sustainability of its attractive dividend, with recent headlines highlighting strong volume growth and the company's confidence in future cash flow generation to support both shareholder returns and growth projects.…
OKE
ONEOK
$93.76
Related headlines
Investment Opinion: Should I buy OKE Today?
Rating & Thesis: The synthesized recommendation is a Hold. The core thesis is that OKE presents a balanced risk/reward profile as a high-yielding, lower-volatility midstream operator with solid fundamentals, but it is currently priced near technical resistance with high analyst forecast uncertainty, warranting caution for new purchases. This aligns with the neutral-to-slightly-bullish analyst consensus sentiment.
Supporting Evidence: The stock trades at a reasonable trailing P/E of 13.64x, below its historical peak and sector averages, suggesting it is not overvalued. Revenue growth is robust at 29.5% YoY, and profitability is improving, with Q4 gross margins expanding to 29.44% from 16.82% in Q1 2025. Free cash flow of $2.45B TTM amply covers the dividend. However, the implied upside is muted as the stock trades at 96.9% of its 52-week high, and the wide dispersion in analyst EPS targets ($5.98 to $9.29) clouds near-term visibility.
Risks & Conditions: The two biggest risks are a failure to meet elevated growth expectations (PEG of 2.95) and a deterioration in commodity markets impacting volumes. This Hold rating would upgrade to a Buy if the stock experiences a meaningful pullback to the $85 support level (offering a better entry yield) or if Q2 2026 earnings convincingly beat estimates and narrow the forecast range. It would downgrade to a Sell if revenue growth decelerates sharply below 10% or if the dividend coverage ratio weakens significantly. Relative to its history and peers, the stock is fairly valued.
Sign up to view all
OKE 12-Month Price Forecast
The AI assessment is neutral with medium confidence. OKE is a fundamentally sound company with strong cash flows supporting a high yield, making it a solid holding for income-oriented portfolios. However, the stock's recent run to near its 52-week high, combined with significant uncertainty in analyst forecasts, limits near-term upside potential and increases vulnerability to a pullback. The stance would upgrade to bullish on a successful breakout above $95.3 with strong volume, confirming a new leg in the uptrend. It would downgrade to bearish if the stock breaks below the $85 support level on high volume, signaling a failure of the current momentum.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on ONEOK's 12-month outlook, with a consensus price target around $121.89 and implied upside of +30.0% versus the current price.
Average Target
$121.89
7 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
7
covering this stock
Price Range
$75 - $122
Analyst target range
Analyst coverage for ONEOK is limited but active, with 7 analysts providing estimates, and the consensus sentiment leans neutral to slightly bullish, as evidenced by recent institutional actions including upgrades to 'Buy' or 'Overweight' from firms like Jefferies and Wells Fargo in March 2026. The average revenue estimate for the coming period is $37.27 billion, with a wide range from $31.38 billion to $43.98 billion, reflecting significant uncertainty around commodity volume and price forecasts, while the average EPS estimate is $7.52, spanning a broad range from $5.98 to $9.29. The wide dispersion in both revenue and EPS targets signals high uncertainty regarding the company's near-term earnings power, which is characteristic of the midstream sector given its sensitivity to energy market fundamentals, and this lack of strong consensus can contribute to stock price volatility as new data emerges.
Bulls vs Bears: OKE Investment Factors
The evidence currently leans bullish, supported by strong fundamental growth, a compelling dividend, and a valuation that is not stretched. The most significant bull points are the 29.5% YoY revenue growth and the 5.58% well-covered yield. However, the bear case is anchored by high analyst forecast uncertainty and moderate financial leverage. The single most important tension in the investment debate is whether the company's robust volume growth and raised guidance can overcome the inherent volatility and uncertainty in energy commodity markets to justify its current valuation and sustain its dividend appeal. The resolution of this tension—specifically, the company's ability to meet or exceed the high end of EPS estimates around $9.29—will likely dictate the stock's direction.
Bullish
- Strong Revenue and Earnings Growth: Q4 2025 revenue grew 29.5% YoY to $9.07B, with sequential quarterly growth from $8.04B in Q1. Net income reached $979M, and the net margin expanded to 10.8%, demonstrating robust operational performance and pricing power.
- Attractive and Well-Covered Dividend: The stock offers a 5.58% dividend yield, which is well-supported by strong free cash flow generation of $2.45B TTM. The payout ratio of 76% indicates a sustainable distribution with room for growth, a key driver for income-focused investors.
- Valuation Discount to Historical Norms: The trailing P/E of 13.64x is near the lower end of its historical range, which has seen peaks above 23x. This suggests the stock is not overextended and may offer relative value if earnings growth continues as projected.
- Positive Analyst Sentiment and Guidance: Recent analyst upgrades to 'Buy' or 'Overweight' from firms like Jefferies and Wells Fargo, coupled with the company's own raised 2026 guidance, signal confidence in future cash flow sustainability and volume growth.
Bearish
- High Analyst Forecast Uncertainty: Analyst EPS estimates for OKE range widely from $5.98 to $9.29, with revenue estimates spanning $31.38B to $43.98B. This significant dispersion reflects high uncertainty around commodity volumes and prices, which can lead to stock price volatility.
- Moderate Financial Leverage: The company's debt-to-equity ratio of 1.46 and a current ratio of 0.71 indicate a leveraged balance sheet and limited short-term liquidity. This is typical for midstream firms but poses a risk if interest rates rise or cash flows weaken.
- Technical Resistance Near 52-Week High: The stock is trading at 96.9% of its 52-week high of $95.3, having recently pulled back from that level. This proximity to a key resistance point increases the risk of a technical correction or consolidation in the near term.
- Slower Growth Relative to Market: While OKE has outperformed the market YTD (+24.2% vs. SPY +8.4%), its 1-year performance of +7.3% lags the SPY's +25.2% gain by nearly 18 percentage points, indicating it may be a relative underperformer in a strong bull market for growth stocks.
OKE Technical Analysis
The stock is in a sustained uptrend, having gained 30.97% over the past six months and 24.19% year-to-date, significantly outperforming the broader market's 8.4% YTD gain. As of the latest close at $92.32, the price is trading at approximately 96.9% of its 52-week high of $95.3, indicating strong momentum but also positioning it near a critical resistance level where profit-taking or consolidation could occur. Recent short-term momentum is positive but shows signs of volatility; the stock gained 9.77% over the past month, outpacing the SPY's 5.6% gain, yet this follows a sharp pullback from its late-March peak near $94, suggesting the uptrend is intact but subject to periodic corrections. Key technical support is anchored at the 52-week low of $64.02, while immediate resistance is the 52-week high of $95.3; a decisive breakout above $95.3 would signal a continuation of the bullish trend, whereas a failure could lead to a retest of support levels around the $85-$87 range established in April. With a beta of 0.762, the stock exhibits approximately 24% less volatility than the broader market, which is typical for a midstream operator with fee-based cash flows and supports its role as a lower-risk, income-oriented holding within the energy sector.
Beta
0.76
0.76x market volatility
Max Drawdown
-26.8%
Largest decline past year
52-Week Range
$64-$95
Price range past year
Annual Return
+9.4%
Cumulative gain past year
| Period | OKE Return | S&P 500 |
|---|---|---|
| 1m | +12.3% | +4.0% |
| 3m | +9.5% | +8.2% |
| 6m | +35.0% | +11.5% |
| 1y | +9.4% | +24.3% |
| ytd | +26.1% | +8.3% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
OKE Fundamental Analysis
Revenue growth has been robust, with Q4 2025 revenue reaching $9.07 billion, representing a significant 29.5% year-over-year increase, and this acceleration is evident as quarterly revenue has climbed sequentially from $8.04 billion in Q1 to the Q4 peak. The company is solidly profitable, reporting Q4 2025 net income of $979 million and a net margin of 10.8%, with gross margins showing improvement to 29.44% in Q4 from 16.82% in Q1 2025, indicating effective cost management and favorable pricing in its NGL and natural gas segments. Financial health is supported by strong cash generation, with trailing twelve-month free cash flow of $2.45 billion providing ample coverage for its dividend, though the balance sheet carries a moderate level of leverage as evidenced by a debt-to-equity ratio of 1.46 and a current ratio of 0.71, which is typical for capital-intensive midstream infrastructure companies.
Quarterly Revenue
$9.1B
2025-12
Revenue YoY Growth
+0.29%
YoY Comparison
Gross Margin
+0.29%
Latest Quarter
Free Cash Flow
$2.4B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is OKE Overvalued?
Given its consistent profitability, the primary valuation metric is the Price-to-Earnings (PE) ratio. The stock trades at a trailing PE of 13.64x and a forward PE of 14.90x based on estimated earnings; the slight premium on the forward multiple suggests the market anticipates modest earnings growth ahead. Compared to sector averages, ONEOK's valuation appears mixed: its trailing PE of 13.64x is below the typical midstream industry average (often in the mid-to-high teens), suggesting a relative discount, while its Price-to-Sales ratio of 1.38x and EV/EBITDA of 10.15x are generally in line with or slightly below peers, indicating the market is not assigning a significant growth premium. Historically, the current trailing PE of 13.64x sits near the lower end of its own multi-year range observed in the provided data, which has seen peaks above 23x and troughs near 6.8x, suggesting the stock is not overextended and may offer value relative to its own history if earnings growth continues as projected.
PE
13.6x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 7x~24x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
10.2x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: ONEOK carries moderate financial leverage with a debt-to-equity ratio of 1.46, which is standard for capital-intensive midstream infrastructure but increases interest rate sensitivity. The current ratio of 0.71 indicates limited short-term liquidity, though this is mitigated by strong TTM free cash flow of $2.45B. Earnings are subject to volatility from commodity price swings, as evidenced by the wide analyst EPS estimate range from $5.98 to $9.29. The sustainability of its attractive 5.58% dividend, while currently well-covered, depends on the continuation of this robust cash flow generation.
Market & Competitive Risks: The stock trades at a trailing P/E of 13.64x, which is below the typical midstream industry average, suggesting it is not overvalued relative to peers. However, its PEG ratio of 2.95 indicates the market is pricing in high growth expectations. With a beta of 0.762, OKE is less correlated to broad market swings but remains exposed to sector-specific risks like regulatory changes affecting energy infrastructure and competition from other midstream operators for volume commitments. Recent news highlights the company's strong performance, but any shift in energy policy or a sustained downturn in natural gas and NGL prices could pressure volumes and fees.
Worst-Case Scenario: The most damaging scenario would involve a sharp, sustained decline in natural gas and NGL prices, leading to reduced producer activity, lower volumes across OKE's network, and a subsequent miss on the low end of EPS estimates ($5.98). This could trigger dividend sustainability concerns, analyst downgrades, and multiple compression. The realistic downside from the current price of $92.32 would be a retest of the 52-week low of $64.02, representing a potential loss of approximately -31%. A more immediate bear-case target could be the support zone around $85 established in April, implying a -8% decline.
FAQ
The key risks are, in order of severity: 1) Commodity & Volume Risk: Earnings are sensitive to natural gas and NGL prices and producer activity, reflected in the wide analyst EPS range. 2) Financial Risk: Moderate leverage (Debt/Equity of 1.46) and low liquidity (Current Ratio 0.71) could pressure the company if interest rates rise or cash flows dip. 3) Valuation Risk: The high PEG ratio of 2.95 sets up the stock for multiple compression if growth disappoints. 4) Technical Risk: Trading at 96.9% of its 52-week high increases the likelihood of a near-term pullback or consolidation.
The 12-month forecast presents three scenarios with associated probabilities. The Base Case (50% probability) sees the stock trading between $90 and $100, assuming it meets the average analyst EPS estimate of $7.52. The Bull Case (30% probability) targets $100 to $110 if the company hits high-end EPS estimates of $9.29. The Bear Case (20% probability) envisions a drop to $70-$85 if earnings disappoint toward the $5.98 low estimate. The base case is most likely, contingent on stable energy commodity markets and continued execution.
OKE appears fairly valued relative to its own history and peers. Its trailing P/E of 13.64x is below the typical midstream industry average and sits near the lower end of its multi-year range, which has seen peaks above 23x. The Price-to-Sales ratio of 1.38x and EV/EBITDA of 10.15x are also in line with sector norms. The market is not paying a significant premium, but the elevated PEG ratio of 2.95 implies it is pricing in solid future earnings growth, leaving little room for error.
OKE is a good buy for income-seeking investors who prioritize a high, sustainable dividend yield (5.58%) and are comfortable with moderate growth and sector-specific risks. For total return investors, it is less compelling at the current price near its 52-week high, as the significant uncertainty in analyst EPS forecasts ($5.98 to $9.29) clouds near-term upside. The stock is best bought on pullbacks toward the $85 support level, which would offer a more attractive entry yield and margin of safety.
OKE is primarily suitable for a long-term investment horizon of 3-5 years or more. Its value proposition is centered on collecting a reliable, high dividend yield over time, which requires patience. The stock's lower beta (0.762) and income focus make it less ideal for short-term trading, as capital appreciation may be slower and more volatile due to commodity-linked earnings. Investors should be prepared to hold through energy sector cycles to realize the full benefit of the dividend compounding.
