ONEOK Debt
| OKE Stock | USD 111.52 5.53 4.72% |
ONEOK Inc holds a debt-to-equity ratio of 2.269. At present, ONEOK's Net Debt is projected to increase significantly based on the last few years of reporting. The current year's Short Term Debt is expected to grow to about 792.7 M, whereas Net Debt To EBITDA is forecasted to decline to 3.57. . ONEOK's financial risk is the risk to ONEOK stockholders that is caused by an increase in debt.
Asset vs Debt
Equity vs Debt
ONEOK's liquidity is one of the most fundamental aspects of both its future profitability and its ability to meet different types of ongoing financial obligations. ONEOK's cash, liquid assets, total liabilities, and shareholder equity can be utilized to evaluate how much leverage the Company is using to sustain its current operations. For traders, higher-leverage indicators usually imply a higher risk to shareholders. In addition, it helps ONEOK Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect ONEOK's stakeholders.
ONEOK Quarterly Net Debt |
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For most companies, including ONEOK, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for ONEOK Inc, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, ONEOK's management will need to obtain alternative financing to ensure there are always enough cash equivalents on the balance sheet to meet obligations.
Price Book 4.0492 | Book Value 28.908 | Operating Margin 0.2266 | Profit Margin 0.1405 | Return On Assets 0.06 |
Given that ONEOK's debt-to-equity ratio measures a Company's obligations relative to the value of its net assets, it is usually used by traders to estimate the extent to which ONEOK is acquiring new debt as a mechanism of leveraging its assets. A high debt-to-equity ratio is generally associated with increased risk, implying that it has been aggressive in financing its growth with debt. Another way to look at debt-to-equity ratios is to compare the overall debt load of ONEOK to its assets or equity, showing how much of the company assets belong to shareholders vs. creditors. If shareholders own more assets, ONEOK is said to be less leveraged. If creditors hold a majority of ONEOK's assets, the Company is said to be highly leveraged.
At present, ONEOK's Non Current Liabilities Total is projected to increase significantly based on the last few years of reporting. The current year's Non Current Liabilities Other is expected to grow to about 1.3 B, whereas Total Current Liabilities is forecasted to decline to about 2.5 B. ONEOK |
ONEOK Bond Ratings
ONEOK Inc financial ratings play a critical role in determining how much ONEOK have to pay to access credit markets, i.e., the amount of interest on their issued debt. The threshold between investment-grade and speculative-grade ratings has important market implications for ONEOK's borrowing costs.| Piotroski F Score | 6 | Healthy | View |
| Beneish M Score | (2.67) | Unlikely Manipulator | View |
ONEOK Inc Debt to Cash Allocation
Many companies such as ONEOK, eventually find out that there is only so much market out there to be conquered, and adding the next product or service is only half as profitable per unit as their current endeavors. Eventually, the company will reach a point where cash flows are strong, and extra cash is available but not fully utilized. In this case, the company may start buying back its stock from the public or issue more dividends.
ONEOK Inc has 21.76 B in debt with debt to equity (D/E) ratio of 2.27, meaning that the company heavily relies on borrowing funds for operations. ONEOK Inc has a current ratio of 0.81, suggesting that it has not enough short term capital to pay financial commitments when the payables are due. Note however, debt could still be an excellent tool for ONEOK to invest in growth at high rates of return. ONEOK Common Stock Shares Outstanding Over Time
ONEOK Assets Financed by Debt
The debt-to-assets ratio shows the degree to which ONEOK uses debt to finance its assets. It includes both long-term and short-term borrowings maturing within one year. It also includes both tangible and intangible assets, such as goodwill.ONEOK Debt Ratio | 35.0 |
ONEOK Corporate Bonds Issued
Most ONEOK bonds can be classified according to their maturity, which is the date when ONEOK Inc has to pay back the principal to investors. Maturities can be short-term, medium-term, or long-term (more than ten years). Longer-term bonds usually offer higher interest rates but may entail additional risks.
ONEOK Short Long Term Debt Total
Short Long Term Debt Total |
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Understaning ONEOK Use of Financial Leverage
ONEOK's financial leverage ratio helps determine the effect of debt on the overall profitability of the company. It measures ONEOK's total debt position, including all outstanding debt obligations, and compares it with ONEOK's equity. Financial leverage can amplify the potential profits to ONEOK's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if ONEOK is unable to cover its debt costs.
| Last Reported | Projected for Next Year | ||
| Short and Long Term Debt Total | 21.8 B | 22.9 B | |
| Net Debt | 21.4 B | 22.5 B | |
| Short Term Debt | 507 M | 792.7 M | |
| Long Term Debt | 21.2 B | 22.2 B | |
| Long Term Debt Total | 14.6 B | 9.4 B | |
| Short and Long Term Debt | 484 M | 637.1 M | |
| Net Debt To EBITDA | 5.08 | 3.57 | |
| Debt To Equity | 1.31 | 1.25 | |
| Interest Debt Per Share | 46.53 | 48.85 | |
| Debt To Assets | 0.49 | 0.35 | |
| Long Term Debt To Capitalization | 0.56 | 0.49 | |
| Total Debt To Capitalization | 0.57 | 0.53 | |
| Debt Equity Ratio | 1.31 | 1.25 | |
| Debt Ratio | 0.49 | 0.35 | |
| Cash Flow To Debt Ratio | 0.20 | 0.20 |
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Analyzing currently trending equities could be an opportunity to develop a better portfolio based on different market momentums that they can trigger. Utilizing the top trending stocks is also useful when creating a market-neutral strategy or pair trading technique involving a short or a long position in a currently trending equity.When determining whether ONEOK Inc is a strong investment it is important to analyze ONEOK's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact ONEOK's future performance. For an informed investment choice regarding ONEOK Stock, refer to the following important reports:Check out the analysis of ONEOK Fundamentals Over Time. You can also try the Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Is Oil & Gas Storage & Transportation space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of ONEOK. If investors know ONEOK will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about ONEOK listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth 0.192 | Dividend Share 3.96 | Earnings Share 4.72 | Revenue Per Share 34.116 | Quarterly Revenue Growth 0.199 |
The market value of ONEOK Inc is measured differently than its book value, which is the value of ONEOK that is recorded on the company's balance sheet. Investors also form their own opinion of ONEOK's value that differs from its market value or its book value, called intrinsic value, which is ONEOK's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because ONEOK's market value can be influenced by many factors that don't directly affect ONEOK's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between ONEOK's value and its price as these two are different measures arrived at by different means. Investors typically determine if ONEOK is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, ONEOK's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
What is Financial Leverage?
Financial leverage is the use of borrowed money (debt) to finance the purchase of assets with the expectation that the income or capital gain from the new asset will exceed the cost of borrowing. In most cases, the debt provider will limit how much risk it is ready to take and indicate a limit on the extent of the leverage it will allow. In the case of asset-backed lending, the financial provider uses the assets as collateral until the borrower repays the loan. In the case of a cash flow loan, the general creditworthiness of the company is used to back the loan. The concept of leverage is common in the business world. It is mostly used to boost the returns on equity capital of a company, especially when the business is unable to increase its operating efficiency and returns on total investment. Because earnings on borrowing are higher than the interest payable on debt, the company's total earnings will increase, ultimately boosting stockholders' profits.Leverage and Capital Costs
The debt to equity ratio plays a role in the working average cost of capital (WACC). The overall interest on debt represents the break-even point that must be obtained to profitability in a given venture. Thus, WACC is essentially the average interest an organization owes on the capital it has borrowed for leverage. Let's say equity represents 60% of borrowed capital, and debt is 40%. This results in a financial leverage calculation of 40/60, or 0.6667. The organization owes 10% on all equity and 5% on all debt. That means that the weighted average cost of capital is (.4)(5) + (.6)(10) - or 8%. For every $10,000 borrowed, this organization will owe $800 in interest. Profit must be higher than 8% on the project to offset the cost of interest and justify this leverage.Benefits of Financial Leverage
Leverage provides the following benefits for companies:- Leverage is an essential tool a company's management can use to make the best financing and investment decisions.
- It provides a variety of financing sources by which the firm can achieve its target earnings.
- Leverage is also an essential technique in investing as it helps companies set a threshold for the expansion of business operations. For example, it can be used to recommend restrictions on business expansion once the projected return on additional investment is lower than the cost of debt.