Oneok Shares Lag Market as Revenue Outlook Rises 36%
Oneok stock fell 1.78% while the S&P 500 rose, driven by flat EPS expectations despite a significant projected jump in net sales.
Key points
- Oneok shares fell 1.78% to $91.80, underperforming the S&P 500 and the Oils-Energy sector in recent trading sessions.
- Consensus revenue estimates for the upcoming quarter show a 36.34% year-over-year increase to $11.77 billion, despite a 2.68% EPS decline.
- The stock trades at a 16.39 Forward P/E, a premium to the industry average of 14.57, reflecting higher growth expectations.
Oneok Inc. shares closed at $91.80, a 1.78% decrease that underperformed the S&P 500’s 1.49% daily gain. The natural gas pipeline company trailed broader market strength, including a 2.26% surge in the Nasdaq, reflecting specific pressure on the stock despite overall sector stability.
According to data reported by Yahoo Finance, the equity has gained 0.14% over the past month. This modest increase lags the 0.51% rise in the Oils-Energy sector, indicating that investors remain cautious about the company's near-term trajectory relative to its peers.
Revenue Growth Outpaces Earnings Estimates
Upcoming quarterly results are expected to show EPS of $1.45, a 2.68% decline from the prior-year quarter. However, consensus estimates project net sales of $11.77 billion, marking a 36.34% increase year-over-year. This divergence suggests volume growth is not yet translating into proportional bottom-line improvements.
Full-year consensus forecasts indicate earnings of $5.70 per share and revenue of $43.83 billion. These figures represent year-over-year increases of 5.17% and 30.34%, respectively. The significant revenue jump points to expanded throughput or commodity price effects, while the modest EPS growth highlights margin constraints.
Valuation Premium Reflects Growth Expectations
Oneok trades at a Forward P/E of 16.39, a premium to the 14.57 industry average. The PEG ratio of 2.67 exceeds the 2.05 industry benchmark, indicating that the market prices in higher growth expectations compared to the Oil and Gas Production Pipeline sector.
The company holds a Zacks Rank of #3, or Hold, after the consensus EPS estimate dropped 1.49% in the last 30 days. This downward adjustment in analyst expectations correlates with the recent share price weakness, signaling reduced near-term optimism despite the strong revenue outlook.
