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a day ago
- Business
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ONEOK Gains From Fee-Based Earnings and Strategic Investments
ONEOK Inc. OKE continues to benefit from increased fee-based earnings and capital expenditures. Its expansion efforts and pipeline additions are intended to strengthen its position in high-production regions and boost its this Zacks Rank #3 (Hold) company is exposed to risks like strong competition in its pipeline business. ONEOK is poised to gain from long-term fee-based commitments across all three of its segments — Natural Gas Gathering and Processing, Natural Gas Liquids, Natural Gas Pipelines and Refined Products and Crude. More than 88% of its 2024 earnings were fee-based. Over 90% of the company's 2025 revenues is expected to be derived from fees. Over the past five years, the annual growth rate for natural gas liquid volumes from the Rocky Mountain region was more than 20%, while that for natural gas processing volumes was 10%. ONEOK is continuing to invest in organic-growth projects to expand into existing operating regions and offer a wide variety of services to crude-oil and natural-gas producers. According to the company, capital expenditures in 2025 are expected to range between $2.8 billion and $3.2 February 2025, ONEOK and MPLX LP inked definitive agreements to form joint ventures to construct a new large-scale 400,000 barrel-per-day liquefied petroleum gas export terminal in Texas City, as well as a new 24-inch pipeline connecting ONEOK's Mont Belvieu, TX, storage facility to the new terminal. To accommodate the rising demand in the area, ONEOK is looking into extending its storage assets in Texas. ONEOK does not own all of the land on which its pipelines are located. The company runs the risk of incurring higher costs related to the necessary land usage. If the company fails to renew current land rights and obtain new rights to lay down pipelines, it will have an impact on the company's operations and natural gas and natural gas liquid pipeline industries are projected to stay extremely competitive. Aside from established pipeline companies, this midstream area has recently seen many energy companies forming master limited partnerships to launch pipeline services. The partnership's assets are well spread out but its capacity to resist competitive pressures will be determined by the efficiency, quality and dependability of the services it offers. In the past year, OKE shares have risen 6.1% compared with the industry's growth of 14.1%. Image Source: Zacks Investment Research Some better-ranked stocks from the same sector are Energy Transfer ET, RGC Resources, Inc. RGCO and Oceaneering International OII, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks Transfer's long-term (three to five years) earnings growth rate is 21.4%. The Zacks Consensus Estimate for 2025 earnings per unit is pegged at $1.44, which indicates a year-over-year rally of 12.5%.RGCO delivered an average earnings surprise of 34.85% in the last four quarters. The Zacks Consensus Estimate for fiscal 2025 earnings per share is pinned at $1.25, which indicates a year-over-year rise of 7.8%.The Zacks Consensus Estimate for OII 2025 sales is pinned at $2.74 billion, which indicates a year-over-year rally of 3.1%. The Zacks Consensus Estimate for 2025 earnings per share is pegged at $1.79, which indicates year-over-year growth of 57%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ONEOK, Inc. (OKE) : Free Stock Analysis Report Oceaneering International, Inc. (OII) : Free Stock Analysis Report Energy Transfer LP (ET) : Free Stock Analysis Report RGC Resources Inc. (RGCO) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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04-06-2025
- Business
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Is RGC Resources (RGCO) Stock Outpacing Its Oils-Energy Peers This Year?
Investors interested in Oils-Energy stocks should always be looking to find the best-performing companies in the group. Is RGC Resources Inc. (RGCO) one of those stocks right now? By taking a look at the stock's year-to-date performance in comparison to its Oils-Energy peers, we might be able to answer that question. RGC Resources Inc. is a member of our Oils-Energy group, which includes 245 different companies and currently sits at #16 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 different groups, measuring the average Zacks Rank of the individual stocks within the sector to gauge the strength of each group. The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. RGC Resources Inc. is currently sporting a Zacks Rank of #2 (Buy). The Zacks Consensus Estimate for RGCO's full-year earnings has moved 1.6% higher within the past quarter. This is a sign of improving analyst sentiment and a positive earnings outlook trend. Based on the most recent data, RGCO has returned 3.3% so far this year. At the same time, Oils-Energy stocks have lost an average of 1.8%. This means that RGC Resources Inc. is performing better than its sector in terms of year-to-date returns. One other Oils-Energy stock that has outperformed the sector so far this year is Subsea 7 SA (SUBCY). The stock is up 9.9% year-to-date. For Subsea 7 SA, the consensus EPS estimate for the current year has increased 9.2% over the past three months. The stock currently has a Zacks Rank #1 (Strong Buy). Looking more specifically, RGC Resources Inc. belongs to the Oil and Gas - Refining and Marketing industry, a group that includes 12 individual stocks and currently sits at #152 in the Zacks Industry Rank. On average, stocks in this group have gained 7.2% this year, meaning that RGCO is slightly underperforming its industry in terms of year-to-date returns. In contrast, Subsea 7 SA falls under the Oil and Gas - Field Services industry. Currently, this industry has 23 stocks and is ranked #179. Since the beginning of the year, the industry has moved -12.9%. RGC Resources Inc. and Subsea 7 SA could continue their solid performance, so investors interested in Oils-Energy stocks should continue to pay close attention to these stocks. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report RGC Resources Inc. (RGCO) : Free Stock Analysis Report Subsea 7 SA (SUBCY) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
