Revenue Miss: ONEOK, Inc. Fell 19% Short Of Analyst Revenue Estimates And Analysts Have Been Revising Their Models

As you might know, ONEOK, Inc. (NYSE:OKE) last week released its latest quarterly, and things did not turn out so great for shareholders. It looks like a weak result overall, with both revenues and earnings falling well short of analyst predictions. Revenues of US$5.0b missed by 19%, and statutory earnings per share of US$1.18 fell short of forecasts by 4.2%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

Check out our latest analysis for ONEOK

After the latest results, the eight analysts covering ONEOK are now predicting revenues of US$28.6b in 2025. If met, this would reflect a major 43% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 28% to US$6.14. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$28.7b and earnings per share (EPS) of US$6.10 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$99.08. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values ONEOK at US$112 per share, while the most bearish prices it at US$81.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's clear from the latest estimates that ONEOK's rate of growth is expected to accelerate meaningfully, with the forecast 33% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 17% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.0% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that ONEOK is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on ONEOK. Long-term earnings power is much more important than next year's profits. We have forecasts for ONEOK going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 2 warning signs for ONEOK (1 is potentially serious!) that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.