In third-quarter 2014, ONEOK Inc.'s earnings surpassed the Zacks
Consensus Estimate and increased year over year, primarily due to
reduced cost of sales and fuel. However, top line failed to beat
estimates mainly due to lower commodity sales. The company is
following its systematic investment strategy in organic growth
projects and acquisitions to expand its scale of operations. Going
forward, the company's disciplined capital spending program will
enable it to meet increasing customer demand and boost the top
line. A stable cash generating capacity also helps the company
distribute regular dividends. However, strict regulations and
volatile global capital and credit markets might deter growth.
Thus, we are maintaining our Neutral recommendation on the stock.
Tulsa, OK-based ONEOK Inc., an energy company, engaged in
natural gas and natural gas liquids (NGL) businesses. The company
offers safe and reliable energy and services to its customers.
ONEOK Inc. is the sole general partner and owner of 41.0% of ONEOK
Partners L.P. (OKS), one of the largest publicly traded master
Previously, ONEOK Inc.'s operations are divided into three
reportable business segments: ONEOK Partners, Natural Gas
Distribution and Energy Services.
On Mar 31, 2014, ONEOK Inc. completed accelerated wind down of
its Energy Services business. In Jun 2013, the company announced
its plan to terminate operations of its energy services
In Jan 2014, ONEOK Inc. separated its Natural Gas Distribution
business (Kansas Gas Service, Oklahoma Natural Gas and Texas Gas
Service) and formed a newly independent entity called ONE Gas, Inc.
In Jul 2013, ONEOK Inc. announced its plan to split its natural gas
ONEOK Partners: The segment engages in gathering and processing
of natural gas and gathering, transporting and fractionating NGL,
primarily in the Mid-Continent and Rocky Mountain regions, which
include the Anadarko Basin of Oklahoma, Fort Worth Basin of Texas,
Hugoton and Central Kansas Uplift Basins of Kansas and the
Williston Basin of Montana and North Dakota and the Powder River
Basin of Wyoming.
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