ONEOK, Inc. (OKE) Stock Rallies on Release of 2016 Outlook


Shares of ONEOK, Inc. (NYSE:OKE) are up big today on heavy volume after the company announce their 2016 Financial Guidance earlier today.

ONEOK, Inc. (NYSE:OKE) announced that they expect that they will have no long-term debt maturities until 2022, no cash income taxes in 2016, and that their dividends will remain flat for the time being. The company’s capital-growth expenditures are expected to come in at around $460 million for 2016, with maintenance capital-expenditures coming in at around $140 million.

“We expect 2016 earnings to be driven by continued natural gas and natural gas liquids volume growth across our integrated pipeline system, with strong year-end performance providing us momentum into 2016. Our substantial backlog of well connects, flared gas inventory in the Williston Basin and uncompleted wells provides considerable visibility into our 2016 volumes,” said Terry K. Spencer, president and chief executive officer of ONEOK and ONEOK Partners. “Our commodity price outlook remains cautious for 2016. However, we expect the partnership’s 2016 earnings to increase compared with 2015 guidance, primarily from volume and fee-based margin increases, resulting in increased distributable cash flow.

The stock is up 9.88% or $1.87 following the news, hitting $20.79 per share. About 2.57 million shares traded hands. OKE has declined 58.71% since May 18, 2015 and is downtrending. It has underperformed the S&P500 by 56.45%.

From a total of 5 analysts covering ONEOK (NYSE:OKE) stock, 2 rate it a “Buy”, 0 a “Sell”, and 3 a “Hold”. This means that 40% of the ratings are positive. The highest target price is $50 while the lowest target price is $27. The mean of all analyst targets is $38.71 which is 86.20% above today’s ($20.79) stock price. ONEOK was the topic of 9 analyst reports since August 11, 2015 according to the firm StockzIntelligence Inc. Barclays Capital maintained shares on December 16 with a “Equal Weight” rating. Oppenheimer maintained OKE stock in a recent report from August 11 with a “Outperform” rating.

The institutional sentiment decreased to 0.75 in Q2 2015. It’s down 0.13, from 0.88 in 2015Q2. The ratio is negative, as 79 funds sold all their ONEOK, Inc. shares they owned while 161 reduced their positions. 41 funds bought stakes while 139 increased their total positions. Institutions now own 130.01 million shares which is 13.13% less than the previous share count of 149.67 million in 2015Q2.

Salient Capital Advisors Llc holds 3.62% of its total portfolio in ONEOK, Inc., equating to 4.63 million shares. Sasco Capital Inc Ct owns 4.99 million shares representing 3.48% of their total US portfolio. Moreover, Eagle Global Advisors Llc has 3.36% of their total portfolio invested in the company, equating to 3.15 million shares. The New York-based Marque Millennium Capital Management Lcc has a total of 1.52% of their portfolio invested in the stock. Trust Investment Advisors, a Indiana-based fund reported 40,075 shares owned.

ONEOK, Inc. is the sole general partner of ONEOK Partners, L.P. , a master limited partnership engaged in the gathering, processing, storage and transportation of natural gas in the United States. The company has a market cap of $4.10 billion. The Firm operates through three divisions: Natural Gas Gathering and Processing, Natural Gas Liquids, and Natural Gas Pipelines. It has 13.79 P/E ratio. The Natural Gas Gathering and Processing segment provides nondiscretionary services to producers, including gathering and processing of natural gas produced from natural gas and crude oil wells.