) completed the spinoff of its natural gas distribution business
this week with the creation ofOne Gas (
), one of the nation's largest natural gas distribution
companies, with more than 2 million customers.
One Gas combines Kansas Gas Service, Oklahoma Natural Gas and
Texas Gas Service. Oneok shareholders received one share of the
new company for every four shares of Oneok they own. Rather than
issue fractional shares, the company will pay cash.
Tulsa-based Oneok has been around since 1906. One division,
Oneok Partners, is a master limited partnership for gathering,
processing, storing and transportation of natural gas and owns a
natural gas liquids system connecting with mid-Continent and
Rocky Mountain regions.
Another division, Energy Services, provides premium services
to customers, primarily local natural gas distribution companies.
It gets the majority of its earnings from physical natural gas
With low prices, natural gas is becoming an increasingly
popular energy source and more of it is being produced and
Oneok has been a beneficiary as earnings have grown in a slow
and steady manner.
In 2012, earnings were $1.64 a share, compared to $1.67 the
previous year. But analysts are forecasting a 9% increase in 2013
and a 3% increase in 2014.
In the most recent quarter, EPS grew at 13% from the year-ago
period, well above estimates, and revenue jumped 18%. Analysts
are forecasting a 5% EPS increase in Q4. The company will report
results Feb. 24 after the close.
Dividends have been growing steadily. Oneok pays out $1.60 a
year in dividends, which translates to a 2.6% yield. The stock is
currently trading near an all-time high.
The five-year Earnings Stability Factor is 6 on a 0 to 99
scale, where low numbers correspond to stable earnings