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ONEOK (OKE) Beats Q3 Earnings & Revenue Estimates, Ups View

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ONEOK Inc (OKE - Free Report) posted third-quarter 2018 operating earnings of 75 cents per share, which beat the Zacks Consensus Estimate of 71 cents by 5.63%. The figure improved 74.4% on a year-over-year basis.

The upside can be attributed to the volume growth in the natural gas liquids segment, courtesy of higher earnings from optimization and marketing activities as well as increased volumes gathered and fractionated in the Mid-Continent region, primarily in the STACK and SCOOP areas.

Total Revenues

Total revenues were $3,394 million, which beat the Zacks Consensus Estimate of $3,308 million by 2.60%. Revenues rose 16.8% from $2,906.4 million in the prior-year quarter.

ONEOK, Inc. Price, Consensus and EPS Surprise

 

ONEOK, Inc. Price, Consensus and EPS Surprise | ONEOK, Inc. Quote

 

Quarterly Highlights

The company spent $2,560.8 million on cost of sales and fuel, up 14.8% from the year-ago quarter’s tally.

In the third quarter, ONEOK’s adjusted earnings before interest, tax, depreciation and amortization (EBITDA) was $650.2 million, up 25.7% year over year.

The company incurred interest expenses of $121.9 million, down 3.7% from $126.5 million in the prior-year quarter. Operating income was $495.5 million in the third quarter, up 39.7% year over year.

ONEOK completed the 110,000 barrel per day (bpd) extension of the West Texas LPG pipeline into the Delaware Basin. Ethane volumes gathered on ONEOK's system increased nearly 100,000 bpd in the Q318, compared with the Q317,

Financial Highlights

As of Sep 30, 2018, ONEOK had cash and cash equivalents of $84.5 million compared with $37.2 million as of Dec 31, 2017.

Long-term debt (excluding current maturities) was $8,325.7 million as of Sep 30, 2018, up from $8,091.6 million as of Dec 31, 2017.

The company’s cash flow from operating activities at the end of Sep 30, 2018 was $1,516.5 million, up from $934 million at the end of Sep 30, 2017.

Capital expenditures (less allowance for equity funds used during construction) amounted to $1,309.7 million, up from $330.4 million in the year-ago period.

Guidance

For 2018, ONEOK raised net income guidance midpoint to $1,180 million from $1,085 million and expects net income in the range of $1,140-$1,220 million. The company also hiked adjusted EBITDA guidance midpoint to $2,470 million from $2,350 million and expected range is $2,430-$2,510 million.

Zacks Rank

ONEOK carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Utility Releases

NextEra Energy (NEE - Free Report) reported third-quarter 2018 adjusted earnings of $2.18 per share, beating the Zacks Consensus Estimate of $2.17 by 0.46%.

DTE Energy Company (DTE - Free Report)     reported third-quarter 2018 operating earnings per share of $2.13, which outpaced the Zacks Consensus Estimate of $1.74 by 22.4%.

FirstEnergy Corporation (FE - Free Report) reported third-quarter 2018 operating earnings of 80 cents per share, beating the Zacks Consensus Estimate of 73 cents by 9.59%.

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