ONEOK (NYSE:OKE) and Energy Transfer (NYSE:ET) Head-To-Head Analysis

ONEOK (NYSE:OKE) and Energy Transfer (NYSE:ET) are both large-cap energy companies, but which is the better business? We will compare the two businesses based on the strength of their risk, profitability, earnings, dividends, institutional ownership, analyst recommendations and valuation.

Analyst Ratings

This is a breakdown of recent ratings for ONEOK and Energy Transfer, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ONEOK	0	6	9	1	2.69
Energy Transfer	0	1	12	0	2.92

ONEOK currently has a consensus price target of $104.57, suggesting a potential upside of 32.34%. Energy Transfer has a consensus price target of $22.58, suggesting a potential upside of 26.87%. Given ONEOK’s higher possible upside, research analysts plainly believe ONEOK is more favorable than Energy Transfer.

Profitability

This table compares ONEOK and Energy Transfer’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ONEOK	12.15%	15.58%	5.42%
Energy Transfer	5.88%	11.47%	3.88%

Dividends

ONEOK pays an annual dividend of $4.12 per share and has a dividend yield of 5.2%. Energy Transfer pays an annual dividend of $1.32 per share and has a dividend yield of 7.4%. ONEOK pays out 80.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Energy Transfer pays out 100.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. ONEOK has raised its dividend for 3 consecutive years and Energy Transfer has raised its dividend for 4 consecutive years. Energy Transfer is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares ONEOK and Energy Transfer”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ONEOK	$21.70 billion	2.29	$3.04 billion	$5.12	15.43
Energy Transfer	$82.06 billion	0.74	$4.45 billion	$1.32	13.48

Energy Transfer has higher revenue and earnings than ONEOK. Energy Transfer is trading at a lower price-to-earnings ratio than ONEOK, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

ONEOK has a beta of 0.99, suggesting that its stock price is 1% less volatile than the S&P 500. Comparatively, Energy Transfer has a beta of 0.79, suggesting that its stock price is 21% less volatile than the S&P 500.

Institutional and Insider Ownership

69.1% of ONEOK shares are held by institutional investors. Comparatively, 38.2% of Energy Transfer shares are held by institutional investors. 0.2% of ONEOK shares are held by company insiders. Comparatively, 3.3% of Energy Transfer shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

ONEOK beats Energy Transfer on 11 of the 18 factors compared between the two stocks.

About ONEOK

ONEOK, Inc. engages in gathering, processing, fractionation, storage, transportation, and marketing of natural gas and natural gas liquids (NGL) in the United States. It operates through four segments: Natural Gas Gathering and Processing, Natural Gas Liquids, Natural Gas Pipelines, and Refined Products and Crude. The company owns natural gas gathering pipelines and processing plants in the Mid-Continent and Rocky Mountain regions; and provides midstream services to producers of NGLs. It also owns NGL gathering and distribution pipelines in Oklahoma, Kansas, Texas, New Mexico, Montana, North Dakota, Wyoming, and Colorado; terminal and storage facilities in Kansas, Nebraska, Iowa, and Illinois; NGL distribution pipelines in Kansas, Nebraska, Iowa, Illinois, and Indiana; transports refined petroleum products, including unleaded gasoline and diesel; and owns and operates truck- and rail-loading, and -unloading facilities connected to NGL fractionation, storage, and pipeline assets. In addition, the company transports and stores natural gas through regulated interstate and intrastate natural gas transmission pipelines, and natural gas storage facilities. Further, it owns and operates a parking garage in downtown Tulsa, Oklahoma; and leases excess office space and rail cars. Additionally, the company transports, stores, and distributes refined products, NGLs, and crude oil, as well as conducts commodity-related activities, including liquids blending and marketing activities. It serves integrated and independent exploration and production companies; other NGL and natural gas gathering and processing companies; crude oil and natural gas production companies; utilities; industrial companies; natural gasoline distributors; propane distributors; municipalities; ethanol producers; petrochemical, refining, and marketing companies; and heating fuel users, refineries, and exporters. ONEOK, Inc. was founded in 1906 and is headquartered in Tulsa, Oklahoma.

About Energy Transfer

Energy Transfer LP provides energy-related services. The company owns and operates natural gas transportation pipeline, and natural gas storage facilities in Texas and Oklahoma; and approximately 20,090 miles of interstate natural gas pipeline. It also sells natural gas to electric utilities, independent power plants, local distribution and other marketing companies, and industrial end-users. In addition, the company owns and operates natural gas gathering pipelines, processing plant, and treating and conditioning facilities in Texas, New Mexico, West Virginia, Pennsylvania, Ohio, Oklahoma, Arkansas, Kansas, Montana, North Dakota, Wyoming, and Louisiana; natural gas gathering, oil pipeline, and oil stabilization facilities in South Texas; and transports and supplies water to natural gas producer in Pennsylvania. Further, it owns 5,700 miles of natural gas liquid (NGL) pipeline; NGL fractionation facilities; NGL storage facilities; and other NGL storage assets and terminal. Additionally, the company provides crude oil transportation, terminalling, acquisition, and marketing activities; owns and operates approximately 14,500 miles of crude oil trunk and gathering pipelines in the Southwest, Midcontinent, and Midwest United States; and sells and distributes gasoline, middle distillate, and motor fuels and other petroleum products. It also offers natural gas compression services; carbon dioxide and hydrogen sulfide removal services; and manages coal and natural resources properties, as well as sells standing timber, leases coal-related infrastructure facilities, collects oil and gas royalty, and generate electrical power. The company was formerly known as Energy Transfer Equity, L.P. and changed its name to Energy Transfer LP in October 2018. Energy Transfer LP was founded in 1996 and is headquartered in Dallas, Texas.