OKE: Bearish Signals Emerge for ONEOK, Inc.

ONEOK is a leading midstream service provider focused on gathering, processing, fractionation, transportation, storage, and marine export of energy products. The company's core business revolves around a 60,000-mile pipeline network, transporting natural gas, NGLs, refined products, and crude oil. ONEOK's target markets include producers in the Rocky Mountain, Mid-Continent, Permian Basin, and North Texas regions, as well as petrochemical companies, refineries, utilities, and exporters. Following recent acquisitions, ONEOK has expanded its presence in key areas, including the 'EnLink' and 'Medallion' assets. ONEOK differentiates itself through its integrated asset base, strategically located in productive shale basins and connected to refineries and demand centers, and its focus on primarily fee-based services, which reduces exposure to direct commodity price volatility.

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OKE's technical outlook is decidedly bearish. The stock price has experienced a significant downtrend over the past 90 days, plummeting from approximately $81.63 on June 30th to $64.29 as of November 4th. The price is trading well below its 50-day SMA of 71.57 and its 21-day EMA of 68.96, confirming the downtrend. The 200-day SMA, while present, is significantly higher at 82.81, reinforcing the long-term bearish sentiment. Momentum indicators support this bearish view; the MACD is negative and trending further downwards, with the MACD line below its signal line. The RSI of 29.16 indicates oversold conditions, which could lead to a short-term bounce, but the overall trend remains negative. The stochastic oscillator, with %K at 14.77 and %D at 15.78, is also indicative of oversold conditions, but the ADX at 18.45 suggests the downtrend is not particularly strong, implying a possible consolidation at lower levels before another leg down. The recent price action shows no signs of reversal, with consistent lower highs and lower lows. Given these factors, the likelihood of continued downward pressure over the next 1-3 months is high.

ONEOK's management discussion presents a generally positive outlook, bolstered by recent acquisitions. 'Total revenues' increased significantly, rising $3.611 billion for the three months ended September 30, 2025, compared to the same period in 2024. 'Net income' also saw a substantial increase of $247 million for the same period. This growth is largely attributed to the positive impact of the EnLink and Medallion Acquisitions across the company's segments. 'Adjusted EBITDA' also increased significantly by $574 million for the three months ended September 30, 2025, compared with the same period in 2024, demonstrating strong operational performance. Capital expenditures also increased for the three and nine months ended September 30, 2025, compared with the same periods in 2024, due primarily to the timing of large capital projects, with total capital expenditures expected to be between '$2.8 billion - $3.2 billion in 2025'. The company also completed an underwritten public offering of '$3.0 billion senior unsecured notes' in August 2025, indicating access to capital markets. While the company had a 'working capital deficit of $550 million' as of September 30, 2025, management does not expect this to have a material adverse impact on cash flows or operations.

The ONEOK second quarter earnings call presents a moderately bullish outlook. The company 'affirmed our 2025 financial guidance ranges,' including net income attributable to ONEOK of $3.1 billion to $3.6 billion and adjusted EBITDA range of $8 billion to $8.45 billion. While the company is 'tempering our previous outlook based on a cautious macro environment' by adjusting the 2026 adjusted EBITDA outlook downward by approximately 2% or $200 million, they still expect 'year-over-year mid- to upper single-digit EBITDA growth in 2026.' This adjustment reflects current commodity prices and spread differentials. Key drivers include synergies from recent acquisitions, with Sheridan Swords highlighting that 'we're expecting record blend volume on our system in 2025 and 2026 will -- everything looks like we will beat that volume as well, the '25 volume in '26.' The company also announced a final investment decision on a new natural gas processing plant in the Permian's Delaware Basin, signaling continued growth and strategic investment. While commodity price volatility presents some uncertainty, ONEOK's integrated assets and strategic positioning support a moderately positive outlook.

OKE's financial performance presents a generally positive trajectory, though some caution is warranted. Revenue has increased from $4.781B in Q1 2024 to $8.634B in Q3 2025, demonstrating significant top-line growth. Profitability, as indicated by the grossProfitRatio, has fluctuated, starting at 0.239 in Q1 2024, peaking at 0.309 in Q3 2025. The operatingCashFlow has been consistently positive, with the latest quarter showing $1.624B, indicating strong cash generation from core operations. However, total debt has decreased from $22.001B in Q1 2024 to $1.741B in Q3 2025, suggesting improved solvency and financial risk management. Overall, OKE exhibits solid revenue growth, healthy cash flow, and a significant reduction in debt, painting a picture of improving financial health. However, the fluctuating gross profit ratio suggests the need to monitor cost management and pricing strategies.

The company demonstrates a moderately bullish profile, characterized by solid revenue growth and improving profitability. Revenue has consistently increased, indicating strong market demand. The gross margin exhibits stability, suggesting effective cost management. Return on Equity (ROE) has improved, showcasing efficient capital allocation. While the Price-to-Earnings (P/E) ratio is elevated, it is potentially justified by the company's growth prospects. The Debt-to-Equity ratio has decreased, reflecting a healthier balance sheet and reduced financial risk. The current ratio is at a healthy level, implying sufficient liquidity to meet short-term obligations. Overall, the company presents a favorable combination of growth, profitability, and balance sheet strength, supporting a positive outlook for the next 12 months, although the high P/E ratio warrants close monitoring.