ONEOK, Inc.
OKE · NYSE
Next quarter
Expected to report Feb 22, 2027 — estimated from last year’s reporting date.
Consensus is $1.43 EPS for Dec 2026 across 8 estimates, ranging $1.32 to $1.58.
OKE Sep 2026
- 45.89%
- -1.53%
- $1.46
- $2.13
- —
- $12.46B
Reported results
- $12.46B
- 22.83%
- $1.57B
- 12.59%
- $1.35B
- $2.13
Highlights
- EPS beat: Diluted EPS of $2.13 exceeded the $1.46 consensus by 45.9%; a $336 million, noncash tax benefit contributed $0.53 per share.
- Adjusted EBITDA: The quarter produced $2.24 billion, up 6% year over year, including a $53 million net transaction-related benefit.
- Guidance raised again: 2026 adjusted EBITDA guidance is now $8.5–$8.6 billion, a $200 million increase to the midpoint from last quarter; the midpoint is $8.55 billion.
- Permian volumes: NGL raw feed throughput rose 6% year over year to 1.661 million barrels per day, with Gulf Coast/Permian volumes up 16%; natural gas processed was 5,866 MMcf/d.
- Segment mix: Refined Products and Crude adjusted EBITDA increased 18% to $685 million and Natural Gas Pipelines rose 16% to $231 million; NGLs fell 4% to $718 million and Gathering and Processing was nearly flat at $563 million.
- Balance sheet reset: Apollo’s $9 billion minority investment funded the extinguishment of nearly $5.5 billion of debt principal; S&P and Fitch upgraded ONEOK to BBB+ with stable outlooks.
- Brazos closed: ONEOK acquired Brazos Midstream’s Permian Midland assets on October 6 for approximately $4.6 billion; management expects about $75 million of 2026 contribution before roughly $25 million of transaction costs.
- Capital and returns: 2026 capital expenditure guidance increased to approximately $3.5 billion. The quarterly dividend remains $1.07 per share, or $4.28 annualized.
Analysis
ONEOK delivered a strong reported quarter, though the EPS beat has a meaningful one-time tax component. Diluted EPS of $2.13 topped the $1.46 consensus by 45.9%, while net income attributable to ONEOK rose to $1.35 billion from $939 million a year ago and $966 million in Q2. The $336 million noncash tax benefit added $0.53 per share; excluding it, EPS was approximately $1.60. Revenue increased 44% year over year to $12.46 billion, largely reflecting higher commodity sales, while operating income was nearly flat at $1.57 billion. Adjusted EBITDA was $2.24 billion, up 6% year over year, including a $53 million net benefit from transactions.
Earnings and guidance
The recurring operating picture was firmer than operating income alone suggests: adjusted EBITDA grew year over year on higher volumes and optimization and marketing activity, while higher operating costs and inventory timing tempered results. Revenue growth should be read alongside the associated commodity costs; ONEOK notes that commodity prices and volumes affect both sales and cost of sales, largely offsetting at the consolidated level.
- Sequential comparison: Revenue advanced to $12.46 billion from $12.05 billion in Q2, while operating income eased to $1.57 billion from $1.59 billion. Net income attributable to ONEOK rose to $1.35 billion from $966 million, reflecting in part the discrete tax benefit.
- 2026 outlook: Guidance now calls for net income of $4.09–$4.27 billion and adjusted EBITDA of $8.5–$8.6 billion, with midpoints of $4.18 billion and $8.55 billion. The EBITDA midpoint is up $200 million from the prior outlook and $450 million from February.
- Increase drivers: Management attributed the $200 million quarterly guidance increase to about $50 million of transaction-related benefits, a net $50 million from Brazos after transaction costs, and $100 million of stronger base-business performance. The outlook includes approximately $75 million of expected Brazos contribution and roughly $25 million of transaction costs.
Apollo investment and leverage
- Capital transaction: Apollo contributed $9 billion for Class B units in ONEOK Holdings. ONEOK used proceeds to extinguish $5.462 billion of debt principal in September and to fund the subsequent Brazos acquisition; debt fell to $28.4 billion at September 30 from $32.0 billion at year-end 2025.
- Credit profile: S&P and Fitch raised long-term ratings to BBB+ from BBB, both with stable outlooks. ONEOK reported a 3.4x net-debt-to-adjusted-EBITDA covenant ratio at September 30.
- Leverage policy: Management now expects to operate at approximately 3.25x or lower, with 3.5x the upper end of its target range and a modeled path below 3x within a few years. It described disciplined deleveraging alongside growth investment and shareholder returns as the base case.
Segment performance
- Refined Products and Crude: Adjusted EBITDA rose $103 million year over year to $685 million. Optimization and marketing added $87 million, including $67 million from liquids blending and $20 million from crude marketing; refined products shipments increased 6% to 1.615 million barrels per day.
- Natural Gas Pipelines: Adjusted EBITDA increased $31 million to $231 million, helped by $22 million of higher optimization and marketing from Waha-to-Katy price differentials and $18 million of higher firm transportation revenue. Management expects that differential opportunity to moderate further in Q4.
- Natural Gas Liquids: Adjusted EBITDA declined $30 million to $718 million. Higher operating costs and $45 million of lower exchange-service earnings associated with unfractionated NGL inventory outweighed higher volumes and a $29 million gain in optimization and marketing.
- Gathering and Processing: Adjusted EBITDA was $563 million, down $3 million, as higher costs offset volume growth. Natural gas processed was 5,866 MMcf/d versus 5,852 MMcf/d a year ago; Permian volumes reached records, and management cited growth across its operating regions.
Permian and Brazos growth
ONEOK completed the Brazos Midland acquisition on October 6 for approximately $4.6 billion, after the quarter-end. The assets complement its existing Midland gathering, processing and NGL infrastructure and are expected to more than double Midland processing capacity to approximately 2.3 Bcf/d, including facilities under construction. Management said current Brazos volumes are ahead of expectations and cited about 14 rigs expected on dedicated acreage in 2027. Connections to ONEOK’s legacy system are intended to improve capital efficiency and create more opportunities to move associated NGLs through its integrated network.
- Near-term capacity: Cassidy I, a 330 MMcf/d Permian processing plant, is expected to enter service at year-end. The Delaware expansion adds 245,000 barrels per day of NGL takeaway capacity and is scheduled for Q3 2027; management said it has commitments from third-party processors and producers as well as additional capacity to market.
- Broader activity: Management reported continued growth in the Mid-Continent and Powder River Basin, with higher rig counts in the Bakken. It expects the recently completed Delaware processing expansions to continue ramping toward capacity in early 2027.
Projects and earnings timing
- Medford inventory: The first 100,000-barrel-per-day phase of the 210,000-barrel-per-day Medford fractionator is expected in December, with the second phase expected in Q1 2027. NGLs accumulated while fractionation capacity was constrained will be processed after start-up; management expects the plant to run full in Q1 and into part of Q2, recognizing deferred fee earnings as the inventory is fractionated.
- Capital plan: ONEOK raised 2026 capital expenditure guidance to approximately $3.5 billion from a prior expectation of approaching $3.2 billion, citing Brazos-related spending and growth projects shifted into 2026. Management expects 2027 spending around $3.3 billion, then approximately $2.5–$3.0 billion annually.
- Longer-term outlook: Management reiterated a mid- to high-single-digit adjusted EBITDA growth target for the next five to seven years from the 2025 base, citing completed and upcoming projects, Brazos, producer activity and commercial optimization across its systems. It expects to provide 2027 guidance with Q4 results.
