ONE Gas, Inc. (OGS) stock analysis

P/E below its 5-year median

ONE Gas's P/E of 17.8 is below its own 5-year median of 18.5.

P/E above the industry

ONE Gas's P/E of 17.8 is above the Gas Production and Distribution median of 17.2.

EV/EBITDA below its 5-year median

ONE Gas's EV/EBITDA of 17.9 is below its 5-year median of 18.4.

P/B below the industry

ONE Gas's price-to-book of 1.47 is below the Gas Production and Distribution median of 2.11.

Trading above fair value

The share price of $82.59 is above our fair value estimate of $77.07.

Margin of safety under 20%

The price is 7.2% above fair value, so there is no margin of safety.

Revenue growth over 3 years

Needs three years of positive revenue.

EPS growing under 10% a year

Diluted EPS grew 2.3% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 16.4% over the last twelve months, against a 5-year average of 6.1% a year.

Growth against the industry

Needs revenue for this year and last.

Guidance raised

ONE Gas raised its 2026 Capital investments, including asset removal costs outlook on Aug 4, 2026.

Gross margin trend

This company does not report gross profit.

Return on equity under 15%

Return on equity was 8.6% over the last twelve months and averaged 8.5% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 5.9%, below the 10% that usually covers the cost of capital.

Return on equity below the industry

ONE Gas's return on equity of 8.6% is below the Gas Production and Distribution median of 12.1%.

Earnings grew over 5 years

Net income grew 6.1% a year on average over the last five fiscal years.

Net margin against its history

Needs five years of revenue and net income.

Net margin against the industry

Needs revenue and net income.

High debt

Debt is 95.0% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 89.6% five years ago to 95.0%.

Debt not well covered by cash flow

Operating cash flow over the last twelve months equals 15.4% of total debt; we look for at least 20%.

Interest not well covered

Operating income covers interest expense 3.5 times; we look for at least 5.

Short-term assets don't cover short-term debts

Current assets are 0.48 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 0.83; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

ONE Gas paid dividends worth 3.3% of the share price over the last twelve months.

Yield below Treasuries

The 3.3% yield is below the 4.6% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.9% or more; ONE Gas yields 3.3%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 57.5% of net income.

Cash-flow cover

Needs dividends paid and free cash flow.