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On Apr 16, 2013, the shares of ONEOK Inc. (OKE - Analyst Report) climbed to its 52-week high of $50.02 driven by completion of three important organic projects and strong fourth-quarter and full-year 2012 results. The strong results were driven by higher natural gas and natural gas liquids (NGL) volumes and lower operating costs. We expect the company’s long-term earnings growth to be 13.83%.

ONEOK Inc. continues to invest in several growth projects and spent $1.9 billion in 2012. The company had a cash balance of $583.6 million as of Dec 31, 2012 and cash from operating activities of $1 billion in 2012. In addition, $380.9 million remains available under the $1.2 billion credit facility. This financial position will enable ONEOK Inc. to pursue steady organic growth strategies and spend $4.7-$5.3 billion through 2015 on several projects.

Apart from investment in internal growth projects, its strong financial position also allows ONEOK Inc. to enhance shareholder value through share repurchases and regular dividend payments.

In 2012, the company repurchased shares worth $150 million under its $750 million 3-year share repurchase program. To date, the company has bought back shares worth $450 million. It can further repurchase shares worth $300 million in 2013.

In Feb 2013, the board of directors of ONEOK Inc. increased its quarterly dividend by 9% to 36 cents per share. The company’s practice of raising dividends from time to time will benefit the stock as it attracts investor attention.

ONEOK Inc.’s full-year 2013 net income guidance is in the range of $350 million to $400 million. In 2012, the company’s net income was $360.6 million. The Zacks Consensus Estimates for full-year 2013 and 2014 are $1.78 and $2.21 per share, up 8.84% and 23.88% year over year, respectively.

ONEOK Inc. currently has a Zacks Rank #3 (Hold). Apart from ONEOK, other stocks in the sector that are worth considering include Chesapeake Utilities Corporation (CPK), The Laclede Group Inc. (LG) and Atmos Energy Corporation (ATO). While Chesapeake carries a Zacks Rank #1 (Strong Buy), both Laclede and Atmos hold a Zacks Rank #2 (Buy).

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