Oneok (OKE) Raises Quarterly Dividend by 4% to $1.07, Annualized Yield at 5.5%
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4d ago
0mins
Source: Fool
- Dividend Yield Advantage: Oneok's current dividend yield stands at 5.5%, significantly higher than the S&P 500's 1.2%, which enhances investor confidence in the company's stability amid a low-yield environment.
- Stable Dividend Growth: The company has raised its quarterly dividend to $1.07 per share (annualized at $4.28), continuing its 25-year track record of stable dividend payments, with nearly a doubling of dividends over the past decade despite not increasing every year.
- Future Growth Potential: Oneok targets a 3% to 4% annual dividend growth, a goal that is achievable given its strong financial foundation and upcoming growth projects, ensuring long-term returns for investors.
- Expansion Projects and Acquisitions: The company is undertaking several organic expansion projects, including a new LPG export terminal and a large-scale natural gas pipeline, expected to provide stable cash flow in the coming years while enhancing its market position through acquisitions.
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Analyst Views on OKE
Wall Street analysts forecast OKE stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for OKE is 86.00 USD with a low forecast of 75.00 USD and a high forecast of 110.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
12 Analyst Rating
7 Buy
5 Hold
0 Sell
Moderate Buy
Current: 79.260
Low
75.00
Averages
86.00
High
110.00
Current: 79.260
Low
75.00
Averages
86.00
High
110.00
About OKE
ONEOK, Inc. is a midstream operator that provides gathering, processing, fractionation, transportation, storage and marine export services. The Company's segments include Natural Gas Gathering and Processing; Natural Gas Liquids; Natural Gas Pipelines, and Refined Products and Crude. The Natural Gas Gathering and Processing segment provides midstream services to producers in the Rocky Mountain region, the Mid-Continent region, the Permian Basin region and the North Texas region. The Natural Gas Liquids segment owns and operates facilities that gather, fractionate, treat and distribute natural gas liquids (NGLs) and store Purity NGLs, primarily in the Rocky Mountain region, Mid-Continent region, Permian Basin and Gulf Coast region (including Louisiana). The Natural Gas Pipelines segment transports, stores and markets natural gas. The Refined Products and Crude segment gathers, transports, stores, distributes, blends and markets refined products and crude oil.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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J.P. Morgan Downgrades Enbridge and ONEOK Ratings
- Rating Downgrade: J.P. Morgan downgraded Enbridge (ENB) and ONEOK (OKE) from Overweight to Neutral with price targets of C$69 and US$83, reflecting concerns over how a softer macro environment impacts growth prospects for both companies.
- Cash Flow Stability: While Enbridge's 98% take-or-pay regulated cash flows provide nearly unmatched stability, the crude oil segment's growth prospects are threatened, particularly with the emerging competitive pressure from Venezuela.
- EBITDA Contribution Analysis: The analyst noted that despite Enbridge's diversified platform and significant scale, the crude oil segment only drives about 35% of the company's EBITDA, making it increasingly challenging to maintain competitive per-share growth over time.
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