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ONEOK (NYSE: OKE ) is a leading midstream platform with an increasing pipeline network that allows the company to deliver highly predictable and stable distributable cash flow to the company’s shareholders. ONEOK is delivering strong DCF, EBITDA and dividend growth andAnalyst’s Disclosure: I/we have a beneficial long position in the shares of OKE, ENB, KMI, WES, EPD either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receivin ...

At ONEOK (NYSE: OKE), we deliver energy products and services vital to an advancing world. We are a leading midstream operator that provides gathering, processing, fractionation, transportation, storage and marine export services. Through our approximately 60,000-mile pipeline network, we transport the natural gas, natural gas liquids (NGLs), refined products and crude oil that help meet domestic and international energy demand, contribute to energy security and provide safe, reliable and responsible energy ...

Analyst's Disclosure: I/we have a beneficial long position in the shares of CSL, LB, TPL, AM either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to w ...

It has been about a month since the last earnings report for Oneok Inc. (OKE) . Shares have added about 6.9% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Oneok due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.How Have Estimates Been Moving Since Then?It turns out, ...

Core Viewpoint - ONEOK Inc. (OKE) is positioned to benefit from higher fee-based earnings and midstream assets in productive regions, while facing competition and seasonal operational risks [1] Factors Acting in Favor of OKE - The company is expected to gain from long-term fee-based commitments, with over 88% of its 2024 earnings being fee-based and an expectation of over 90% for 2025 [2] - ONEOK has achieved over 16% growth in adjusted EBITDA over the past 11 years and anticipates similar growth moving forward, projecting adjusted EBITDA between $8 billion and $8.45 billion for 2025 [2] - Recent acquisitions, including Medallion Midstream and EnLink Midstream, are expected to generate significant cost savings and synergies, enhancing profitability [3] - Continued investment in organic growth projects aims to expand services for crude oil and natural gas producers and end-use markets [4] Headwinds for OKE - The natural gas and natural gas liquids pipeline sector remains highly competitive, with new energy companies forming master limited partnerships for pipeline services, which may challenge OKE's market position [5] - Seasonal fluctuations in operations may lead to revenue variability, particularly during peak demand periods when prices could rise [6] Stock Price Performance - In the past month, OKE shares have increased by 2%, contrasting with a 0.8% decline in the industry [7] Stocks to Consider - Other stocks in the industry with favorable rankings include Plains All American Pipeline (PAA) and Delek Logistics Partners (DKL), both rated Zacks Rank 1 (Strong Buy), and NextDecade (NEXT), rated Zacks Rank 2 (Buy) [8]

Company Overview - Oneok Inc. (OKE) closed at $93.50, showing a +0.57% change from the previous day's closing price, outperforming the S&P 500 which fell by 0.91% [1] - Over the past month, Oneok's shares have decreased by 4.76%, which is a smaller decline compared to the Oils-Energy sector's loss of 4.23% and the S&P 500's loss of 7.38% [2] Earnings Expectations - The upcoming earnings release is anticipated to show an EPS of $1.33, reflecting a 22.02% increase from the same quarter last year, with revenue expected to reach $7.35 billion, indicating a 53.81% growth year-over-year [3] - For the entire fiscal year, earnings are projected at $5.50 per share and revenue at $28.34 billion, representing increases of +6.38% and +30.63% respectively from the previous year [4] Analyst Sentiment - Recent shifts in analyst projections for Oneok Inc. should be monitored, as upward revisions indicate positive sentiment regarding the company's business operations and profit generation capabilities [5] - The Zacks Rank system, which evaluates estimate changes, currently ranks Oneok Inc. at 3 (Hold), with a consensus EPS projection that has decreased by 9.91% in the last 30 days [7] Valuation Metrics - Oneok Inc. is trading with a Forward P/E ratio of 16.9, which is a premium compared to the industry average Forward P/E of 12.62 [8] - The company has a PEG ratio of 3.85, significantly higher than the industry average PEG ratio of 1.12 [8] Industry Context - Oneok operates within the Oil and Gas - Production Pipeline - MLB industry, which is part of the Oils-Energy sector and holds a Zacks Industry Rank of 9, placing it in the top 4% of over 250 industries [9]

Core Insights - ONEOK reported Q4 earnings on February 25 and provided guidance for 2025 and 2026 following its recent acquisitions of EnLink Midstream and Medallion [1] Financial Performance - The company has over 30 years of personal investing experience and focuses on small to mid-sized midstream companies, as well as larger topics like energy transition and macroeconomic questions [1] Investment Strategy - The company considers itself a value investor, recommending companies that produce high returns over a 3-8 year time horizon [1]

Group 1 - ONEOK, Inc. will hold its 2025 annual meeting of shareholders virtually on May 21, 2025, at 9 a.m. Central Time, with a record date of March 24, 2025, for determining eligible shareholders [1][4] - ONEOK is a leading midstream operator in North America, providing essential energy products and services, including gathering, processing, transportation, and storage, through a pipeline network of approximately 60,000 miles [2][3] - The company plays a significant role in meeting both domestic and international energy demand, contributing to energy security and providing reliable energy solutions [2]

Financial Strategy and Performance - The company aims to maintain investment-grade credit ratings and a strong balance sheet, expecting internally generated cash flows to fund high-return capital projects, grow dividends, reduce debt, and support a $2.0 billion share repurchase program[45]. - The company is focused on maximizing total shareholder return through high-return capital projects and consistent returns on invested capital[45]. - The company completed the sale of three interstate natural gas pipeline systems on December 31, 2024[74]. Natural Gas Operations - The Natural Gas Gathering and Processing segment has a processing capacity of 1.9 Bcf/d in the Rocky Mountain region and 1.0 Bcf/d in the Mid-Continent region, with utilization rates of 84% and 77% for 2024 and 2023, respectively[54]. - The Natural Gas Liquids segment has a processing capacity of 1.4 Bcf/d in the Mid-Continent region, 1.7 Bcf/d in the Permian Basin, and 0.8 Bcf/d in North Texas, with fee-based contracts representing 76% and 72% of supply volumes for 2024 and 2023, respectively[60]. - The company operates a natural gas pipeline system that connects key supply areas and demand centers, supporting low-cost expansions to meet growing demand from data centers and utilities[72]. - The company has a 50% ownership interest in Northern Border, which transports natural gas with a capacity of 2.5 Bcf/d[85]. - The ONEOK Gas Transportation has access to major natural gas production areas in the Mid-Continent region, including the SCOOP and STACK areas[76]. - The Sabine Pipeline, acquired through EnLink Acquisitions, operates as an interstate natural gas pipeline connecting Port Arthur, Texas, to the Henry Hub[75]. Infrastructure and Capacity Expansion - The Natural Gas Liquids segment added 9,300 miles of gathering pipelines and 4,800 miles of distribution pipelines as a result of the EnLink Acquisitions, with NGL fractionators having a combined operating capacity of 960 MBbl/d[64]. - The ongoing Denver area pipeline expansion project will add 35 MBbl/d to the system capacity[89]. - The company has access to 6 MMBbl of combined NGL storage capacity at facilities in Kansas and Texas, enhancing its operational flexibility[63]. - The company is reconstructing a 210 MBbl/d fractionator in Medford, Oklahoma, to improve its NGL processing capabilities[62]. Environmental and Regulatory Compliance - The company is subject to various environmental regulations, including the Clean Air Act and the Clean Water Act, which may require capital expenditures for compliance[106]. - The company is required to satisfy its Renewable Volume Obligation (RVO) under the Renewable Fuel Standard, which may increase compliance costs over time[116]. - The company has completed updates to its pipeline maintenance procedures to minimize methane leaks as part of compliance with the Protecting our Infrastructure of Pipelines and Enhancing Safety Act[113]. - The company does not anticipate a material impact on its operations from the EPA's finalized rule targeting oil and gas section emissions of greenhouse gases[115]. - The company anticipates future governmental legislation may require limits on GHG emissions, potentially impacting capital expenditures and operations[120]. - The company is subject to the EPA's Mandatory Greenhouse Gas Reporting Rule, which requires annual reporting of GHG emissions from affected facilities[114]. Employee Engagement and Benefits - Employee engagement participation rate increased to 93% in 2024 from 90% in 2022, with the overall engagement mean rising to the 80th percentile[134]. - As of December 31, 2024, the company had 5,177 employees, excluding EnLink employees[135]. - The company provides up to $10,000 for reasonable and necessary expenses related to adoption and surrogacy[142]. - The company offers up to $5,250 per year in qualifying tuition expenses for furthering education[145]. - The company maintains a 401(k) Plan with a 100% match on employee contributions up to 6% of eligible compensation, with 96% of eligible employees participating as of December 31, 2024[147]. - Effective January 1, 2025, profit-sharing quarterly contributions will increase from 1% to 6% of quarterly eligible compensation[147]. - The company provides full pay for maternity, paternity, or adoption leave of up to 240 hours per qualifying event[142]. - The ONE Trust Fund allows employees to contribute donated vacation hours or monetary donations to assist fellow employees in times of personal crises[143]. - The company has a charitable giving matching program of $10,000 annually through the ONEOK Foundation[143]. Sustainability and Emissions Reduction - In 2023, GHG emissions were approximately 3.7 million metric tons of carbon dioxide equivalents for Scope 1 and 3.1 million metric tons for Scope 2 emissions[109]. - The company aims for a 30% reduction in combined operational Scope 1 and location-based Scope 2 GHG emissions by 2030, targeting a reduction of 2.2 million metric tons of carbon dioxide equivalents[110]. - As of December 31, 2024, the company has achieved reductions totaling approximately 1.7 million metric tons towards its GHG emissions reduction target[110]. - The company is actively participating in the Our Nation's Energy (ONE) Future Coalition to report methane emission reductions and calculate methane intensity for its natural gas transmission and storage assets[111]. - The company has achieved a reduction of approximately 1.7 million metric tons of GHG emissions towards its target of 2.2 million metric tons by 2030, representing a 30% reduction from 2019 levels[110]. - The company is monitoring potential future regulations that may require it to limit GHG emissions or pay additional fees associated with its emissions[120]. Corporate Culture and Diversity - The company has a zero-incident culture commitment for employee safety and environmental responsibility[137]. - The company has established four employee-led business resource groups to promote inclusion and diversity[139]. - The company has a cross-functional inclusion and diversity strategy aimed at attracting and retaining talent[138]. - The company has implemented a Cybersecurity Implementation Plan, with the last approval in August 2024[132].