Key Stats for ONEOK Stock
- Past-Week Performance: -1.8%
- 52-Week Range: $ to $
- Current Price: $
What Happened?
ONEOK (OKE), a Tulsa-based operator of 60,000 miles of natural gas, NGL, refined products, and crude oil pipelines, is that its 12-year streak of adjusted EBITDA growth now faces its sharpest test yet, with 2026 guidance of $7.9 billion to $8.3 billion coming in below the $8.02 billion it delivered in 2025, even as the stock sits at $85.36 after falling from a 52-week high of $103.64.
ONEOK reported Q4 2025 EPS of $1.55, beating the $1.53 consensus estimate, but adjusted EBITDA of $2.15 billion missed the $2.17 billion estimate, triggering a 5.6% premarket decline on February 24 as brokers including RBC Capital Markets and TD Cowen flagged soft volume expectations across segments and a natural gas pipelines unit whose adjusted EBITDA dropped to $261 million from $417 million a year earlier following the 2024 divestiture of an interstate pipeline network.
The operational engine holding the thesis together is the Eiger Express Pipeline, ONEOK’s joint venture conduit moving Permian natural gas toward Gulf Coast demand and LNG export hubs, which was expanded to 3.7 Bcf/day from 2.5 Bcf/day in November 2025 and is now 100% contracted for a minimum of 10 years, a development that anchors fee-based cash flow at the growth segment most critical to the 2027 earnings ramp.
Chief Commercial Officer Sheridan Swords stated on the Q4 2025 earnings call that “we are in some advanced negotiations with some hyperscalers out there that we feel really good about” and added that the company expects to “announce something in the fairly near future,” tying directly to ONEOK’s stated pipeline of data-center power discussions across its natural gas storage and transportation network.
With $150 million of identified incremental synergies fully in the 2026 plan, the Medford NGL fractionator rebuild adding 100,000 barrels per day of fractionation capacity in Q4 2026 and a further 110,000 barrels per day in Q1 2027, and the Denver refined products expansion coming online mid-Q3 2026 under full take-or-pay contracts, ONEOK’s earnings cadence is structurally designed to build through the back half of 2026 and accelerate into 2027 as capital spending steps down and free cash flow expands.
Wall Street’s Take on OKE Stock
The February 24 EBITDA miss that drove OKE down 5.6% premarket reflected the same commodity-driven volume softness that has pressured the stock from $103.64 to $85.36, yet the 90% fee-based earnings structure means realized pricing risk is far narrower than the selloff implies.
TIKR’s model projects adjusted EBITDA growing from $8.02 billion in 2025 to $8.26 billion in 2026 and $8.65 billion in 2027, supported by the Medford fractionator adding 210,000 barrels per day of NGL processing capacity across Q4 2026 and Q1 2027 and the Denver refined products expansion entering service mid-Q3 2026 under fully contracted take-or-pay terms.
The more compelling number is free cash flow, which measures what ONEOK actually keeps after maintaining and growing its 60,000-mile pipeline network: TIKR’s model projects FCF surging 32.6% to $3.24 billion in 2026 from a 2025 trough of $2.45 billion, driven by project completions, no meaningful cash taxes until 2029, and declining capital expenditures as the current build cycle winds down.
Sentiment on the Street has visibly shifted, with 8 buys, 3 outperforms, and 11 holds among 20 analysts covering OKE as of March 13, reflecting a wall of cautious fence-sitters whose mean price target of $89.75 implies only 5.1% upside from the current $85.36 and suggests the consensus has not yet priced in the 2027 FCF acceleration.
The spread between the low analyst target of $74.00 and the high of $104.00 tells the real debate: the bear case anchors to Bakken volume attrition and a 18,000 bbl/day NGL contract loss to Kinder Morgan, while the bull case underwrites the Eiger Express Pipeline running at 3.7 Bcf/day under 10-year contracts as the foundation for sustained fee income regardless of commodity direction.
What Does the Valuation Model Say?
TIKR’s model prices OKE at $118.32 by December 2030, implying a 38.6% total return at a 7% annualized IRR, anchored to a net income margin expanding from 10.1% in 2025 to 12.8% in the mid-case as the company’s $475 million in cumulative synergies fully embed and the Medford and Bighorn capacity additions absorb contracted volumes.
The market is treating ONEOK’s 2026 EBITDA midpoint of $8.1 billion as a ceiling when the $150 million in identified incremental synergies and the Eiger’s 100% contracted 3.7 Bcf/day capacity make it a floor.
The Medford fractionator’s Phase 1 coming online in Q4 2026 and Phase 2 in Q1 2027, adding 210,000 barrels per day of NGL processing capacity in total, is the specific operational development justifying TIKR’s model target of $118.32.
CFO Walter Hulse confirmed on the February 24 earnings call that incremental free cash flow “really kicks off” after H2 2027 project completions, a management signal that the compounding effect of lower capex and higher volumes is deliberate, not accidental.
The risk is crude oil settling durably below $55 per barrel, which would slow Bakken drilling below current rig rates and delay the volume ramp that bridges the 2026 EBITDA midpoint to the 2027 step-up TIKR’s model requires.
Watch the Q1 2026 earnings call in late April for Permian NGL volume growth and the first commercial update on hyperscaler data center negotiations, which Sheridan Swords indicated could produce an announcement in the near term.
Should You Invest in ONEOK, Inc.?
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