The 10-second takeaway
For the quarter ended June 30 (Q2), ONEOK beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly. Non-GAAP earnings per share grew significantly. GAAP earnings per share dropped to zero.
Margins contracted across the board.
ONEOK reported revenue of $3.35 billion. The four analysts polled by S&P Capital IQ predicted sales of $3.27 billion on the same basis. GAAP reported sales were 32% higher than the prior-year quarter's $2.53 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
EPS came in at $0.34. The 10 earnings estimates compiled by S&P Capital IQ predicted $0.29 per share. Non-GAAP EPS of $0.34 for Q2 were 17% higher than the prior-year quarter's $0.29 per share. GAAP EPS contracted to zero from the prior-year quarter's $0.29.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures are normalized by S&P Capital IQ and may vary to maintain comparability with normalized estimates.
For the quarter, gross margin was 7.5%, 610 basis points worse than the prior-year quarter. Operating margin was 3.8%, 540 basis points worse than the prior-year quarter. Net margin was 0.0%, 240 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $4.22 billion. On the bottom line, the average EPS estimate is $0.31.
Next year's average estimate for revenue is $15.92 billion. The average EPS estimate is $1.65.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 432 members out of 446 rating the stock outperform, and 14 members rating it underperform. Among 151 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 147 give ONEOK a green thumbs-up, and four give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on ONEOK is outperform, with an average price target of $53.25.
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