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Investing.com - Raymond (NSE:RYMD) James lowered its price target on ONEOK Inc (NYSE:OKE) to $110.00 from $115.00 on Monday, while maintaining an Outperform rating on the stock. Currently trading at $80.38, ONEOK, with a market cap of $50.6 billion, shows potential upside according to InvestingPro analysis, which rates the company’s overall financial health as "GOOD."
The price target reduction follows Raymond James’ revised estimates for 2027, though the firm reiterated its positive outlook on the midstream energy company.
Raymond James noted that ONEOK currently trades at approximately 8.5x its revised 2027 estimated EV/EBITDA, compared to large-cap midstream peers that trade in the 8x-13x range, with the broader midstream space five-year average multiple in double-digits.
The firm expects ONEOK to begin approaching its traditional moderate premium to peers as the company proves out its commercial deal synergy potential.
Raymond James also anticipates ONEOK will be "a strong suitor for generalist investment again in 2025," supporting the firm’s continued Outperform rating despite the target price reduction.
In other recent news, ONEOK, Inc. announced it will maintain its quarterly dividend of $1.03 per share, resulting in an annualized dividend of $4.12 per share. This decision reflects the company’s ongoing dividend policy, with no changes from the previous quarter. Additionally, ONEOK has completed the acquisition of Delaware G&P LLC, purchasing the remaining 49.9% stake for $940 million. This acquisition significantly expands ONEOK’s operations in the Permian Basin, enhancing its portfolio of energy infrastructure assets.
In analyst updates, Scotiabank (TSX:BNS) lowered its price target for ONEOK to $92, citing commodity price impacts, while maintaining a Sector Outperform rating. Mizuho (NYSE:MFG) also reduced its price target from $107 to $87, expressing caution about ONEOK’s long-term growth outlook despite expected improvements from growth projects. TD Cowen initiated coverage with a Hold rating and a price target of $91, noting the company’s significant acquisition strategy but limited growth prospects in NGL infrastructure. These developments provide investors with insights into ONEOK’s strategic moves and market positioning.
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