ONEOK Inc (OKE) stock analysis

P/E below its 5-year median

Oneok's P/E of 13.7 is below its own 5-year median of 16.4.

P/E below the industry

Oneok's P/E of 13.7 is below the Gas Production and Distribution median of 17.3.

EV/EBITDA below its 5-year median

Oneok's EV/EBITDA of 12.1 is below its 5-year median of 12.8.

P/B above the industry

Oneok's price-to-book of 2.38 is above the Gas Production and Distribution median of 2.10.

Trading below fair value

The share price of $88.17 is below our fair value estimate of $101.65.

Margin of safety under 20%

The price is 13.3% below fair value, less than the 20% cushion we look for.

Revenue growing 10%+ a year

Revenue grew 14.5% a year over the last three fiscal years.

EPS growing 10%+ a year

Diluted EPS grew 12.2% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew 21.8% over the last twelve months, against a 5-year average of 40.8% a year.

Growing faster than the industry

Revenue grew 36.8% over the last twelve months; the Gas Production and Distribution median is 13.6%.

Guidance lowered

Oneok lowered its 2026 Net income attributable to ONEOK outlook on Oct 27, 2026.

Gross margin slipping

Gross margin was 25.2% over the last twelve months, against 32.0% a year earlier.

Return on equity over 15%

Return on equity was 17.9% over the last twelve months and averaged 21.5% over five years.

Return on capital under 10%

Return on invested capital was 9.7%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

Oneok's return on equity of 17.9% is above the Gas Production and Distribution median of 12.1%.

Earnings grew over 5 years

Net income grew 40.8% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 9.4% over the last twelve months, against a 5-year average of 11.7%.

Net margin below the industry

Oneok's net margin of 9.4% is below the Gas Production and Distribution median of 13.1%.

High debt

Debt is 122% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 236% five years ago to 122%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 20.7% of total debt.

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 0.84 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 1.70; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Oneok paid dividends worth 3.6% of the share price over the last twelve months.

Yield below Treasuries

The 3.6% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Oneok yields 3.6%.

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 65.7% of net income.

Not covered by free cash flow

Dividends take 106% of free cash flow.