While Fools should generally take the opinion of Wall Street with a grain of salt, it's not a bad idea to take a closer look at particularly stock-shaking upgrades and downgrades -- just in case their reasoning behind the call makes sense.
What: Shares of ONEOK Partners LP (NYSE: OKS ) climbed 1% this morning after Goldman Sachs upgraded the natural gas storage and transportation company from "sell" to "neutral".
So what: Along with the upgrade, analyst Theodore Durbin raised his price target to $57 (from $55), representing about 8% worth of upside to yesterday's close. While momentum traders might be turned off by the stock's sluggish action in 2013, Durbin believes that ONEOK's announcement this morning -- it will spend up to $780 million on projects in the oil-rich area around Williston, ND -- should give its prospects a decent boost going forward.
Now what: Goldman believes that ONEOK's risk/reward trade-off is pretty balanced at this point. "On the announcement, we lower our 2015 distributable cash flow (DCF) estimate for OKS by 5% on higher financing costs, maintain 2016, but raise our 2017 estimate by 6% assuming 6x EBITDA multiple project returns, similar to other 'bolt-on' organic returns," noted Goldman. With the stock still off about 15% from its 52-week highs and sporting a 5%-plus dividend yield, ONEOK Partners is definitely worth a look.
More dynamic dividend picks
Dividend stocks can make you rich. It's as simple as that. While they don't garner the notoriety of high-flying growth stocks, they're also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine. With this in mind, our analysts sat down to identify the absolute best of the best when it comes to rock-solid dividend stocks, drawing up a list in this free report of nine that fit the bill. To discover the identities of these companies before the rest of the market catches on, you can download this valuable free report by simply clicking here now.
RSS Headlines
Fool UK
Comments from our Foolish Readers
Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the
Report this Comment icon found on every comment.
Be the first one to comment on this article.