SKN | Barclays Raises ONEOK Price Target to $82 While Keeping Equal Weight Rating

Key Points

• Barclays raised its price target on ONEOK to $82 from $76 while maintaining an Equal Weight rating.
• The upgrade reflects confidence in ONEOK’s diversified midstream footprint and operating leverage.
• Management highlighted strong earnings growth, synergy gains from the Magellan acquisition, and stable fee-based revenue. 

Barclays raised its price target for ONEOK to $82 from $76 while maintaining an Equal Weight rating following meetings with company management. The firm said the company’s diversified infrastructure and operating leverage position it to benefit from increasing natural gas demand across multiple basins.

Barclays analyst Theresa Chen noted that ONEOK’s broad asset footprint provides exposure to long-term growth opportunities in U.S. natural gas and natural gas liquids markets.

Strong Financial Performance in 2025

During the company’s fourth-quarter 2025 earnings call, ONEOK President and Chief Executive Officer Pierce Norton described the past year as a pivotal period for the company. Net income attributable to ONEOK increased by 12 percent to $3.39 billion, while adjusted EBITDA rose 18 percent to $8.02 billion.

The company also reported progress following its acquisition of Magellan Midstream Partners. Norton said the integration has generated nearly $500 million in total synergies so far, including approximately $250 million realized during 2025.

Outlook for 2026 Growth

Looking ahead, management expects the company’s 2026 adjusted EBITDA midpoint forecast of approximately $8.1 billion to be supported by higher pipeline volumes, recently completed infrastructure projects, and an additional $150 million in expected synergies related to the Magellan transaction.

These factors are expected to contribute to continued earnings growth while strengthening the company’s operational scale across its energy infrastructure network.

Fee-Based Revenue Model Supports Stability

Norton emphasized that roughly 90 percent of ONEOK’s earnings are generated through fee-based contracts. This structure limits direct exposure to fluctuations in commodity prices and provides a more stable revenue base compared with producers whose earnings are closely tied to energy price movements.

Such fee-based earnings models are common among midstream operators and are often viewed by investors as providing more predictable cash flows.

Long-Term Growth Opportunities

ONEOK’s strategy focuses on expanding scale, improving integration across its network, and maintaining stable revenue streams through long-term transportation and processing agreements.

The company also sees long-term development potential in the Bakken Formation, where management estimates that roughly 5,000 wells remain to be drilled on dedicated acreage. Continued development in the region could support additional demand for the company’s infrastructure services.

About ONEOK

ONEOK is a major midstream energy operator providing gathering, processing, fractionation, transportation, storage, and export services for natural gas and natural gas liquids. The company operates across multiple business segments including natural gas gathering and processing, natural gas liquids infrastructure, pipeline transportation, and refined products logistics.

Outlook

Analysts believe ONEOK’s diversified asset base and fee-based revenue structure position the company to benefit from continued growth in U.S. natural gas demand. Investors will likely monitor volume trends, infrastructure expansion, and integration progress following the Magellan acquisition to assess the company’s long-term growth trajectory.

For confidential inquiries, partnership opportunities, or further insights regarding energy infrastructure investments, midstream sector developments, and institutional energy market strategies, interested parties are encouraged to contact our team directly for professional engagement.