) has announced that it will pay an incremental dividend in the
first quarter of 2014. The board of directors has increased the
quarterly cash dividend rate by 5.3% sequentially and 11.1% year
over year to 40 cents per share. The increased dividend will be
paid on Feb 18, 2014, to stockholders of record as of Feb 10.
During a press release in Dec 2013, ONEOK Inc. had expressed its
intention to hike its quarterly dividend rate to 56 cents per
share from 38 cents per share, after the completion of the ONE
For 2014, ONEOK Inc. intends to raise the dividend rate by 1.5
cents per share per quarter, subject to the board's approval. In
the long term, the company is targeting to maintain a dividend
coverage ratio of about 1.05 times, subject to the approval.
The company also plans to raise the average annual dividend in
the range of 20% - 25% between 2013 and 2016. This includes the
estimated dividend hike in 2014 and 10% yearly increases in the
years 2015 and 2016.
ONEOK Inc.'s policy of paying incremental dividends supports its
commitment to improve long-term value for shareholders. The
company has increased its dividend 17 times since 2006. The last
quarterly dividend hike was made in Jul 2013. The quarterly
dividend had increased 5.6% to 38 cents per share from the
earlier payout of 36 cents per share.
The company's cash flow from operating activities during the
first nine months of 2013 was $1.0 billion while the cash balance
was $0.8 billion as of Sep 30, 2013. A strong financial position
helps ONEOK Inc. to meet its anticipated cash requirements for
dividend payment and future projects.
Further, ONEOK Inc. plans to invest $2.3 billion in 2014. Of this
investment, the majority will be allocated to several growth
ONEOK Partners, L.P.
) portfolio. This is to cope with the increased demand from
natural gas producers and processors. These initiatives would
boost the company's profitability in the long run, which in turn
will enable it to provide higher returns to its shareholders.
ONEOK Inc. currently has a Zacks Rank #3 (Hold). However, some
better-ranked stocks in the same industry include
Chesapeake Utilities Corporation
MDU Resources Group Inc.
), each with a Zacks Rank #2 (Buy).
CHESAPEAKE UTIL (CPK): Free Stock Analysis
MDU RESOURCES (MDU): Free Stock Analysis
ONEOK INC (OKE): Free Stock Analysis Report
ONEOK PARTNERS (OKS): Free Stock Analysis
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