Oneok Is Up 18% in 2026 and Currently Yields 4.8%. Is It Still Worth Buying?

Oneok has risen more than 19% year to date as it lifted 2026 guidance after a strong first quarter, with net income up 12% and EBITDA up 13%. The company also increased its annual dividend to $4.28 per share, and roughly 90% of earnings were fee-based, supporting stability. Valuation is less attractive after the rally, with forward and trailing P/E both just under 16 and the PEG above 2.

Analysis

OKE’s move looks less like a pure re-rating and more like the market finally pricing the quality of its cash flow through the cycle. The key second-order effect is that a fee-based midstream model with rising volumes can de-risk the dividend while still compounding EBITDA, which makes OKE function more like a bond proxy with operating leverage than a classic commodity beta trade. That’s why the stock can keep grinding higher even when the headline yield looks less compelling: the marginal buyer is likely rotating from yield-seeking capital into “quality income plus growth” capital.

The more important signal is competitive positioning versus ET and EPD. OKE’s stronger execution should widen the valuation gap against lower-multiple peers only if the market believes throughput gains are durable rather than a one-quarter phenomenon; if NGL volumes normalize, the premium becomes vulnerable because midstream rerates can reverse quickly once growth visibility fades. For EPD, the setup is more constructive on relative basis because its lower-beta balance sheet and distribution framework may attract the same defensive income flows without needing as much near-term growth narrative.

The contrarian risk is that guidance upgrades often mark a local peak in expectation, especially after a sharp run. On a 3-6 month horizon, the stock is most exposed to any signs of plateauing Permian/Gulf Coast volumes or a compression in investor appetite for utilities-like income plays if rates reprice higher. In that scenario, the equity can de-rate faster than the dividend yield can cushion, because investors are paying up for stability, not just payout.

Key Decisions for Investors

• Stay constructive on OKE, but trim into strength after the recent move; use a 3-6 month horizon and treat it as a hold rather than fresh aggressive add until the next volume data point confirms durability.
• Pair trade: long OKE / short ET on a 1-3 month relative basis if you want to express preference for cleaner execution and lower perceived balance-sheet noise; target a modest spread capture with defined stop if ET catches up on sentiment.
• Relative-value switch: rotate incremental capital from OKE into EPD on any further OKE rally; EPD offers a more durable defensive income profile if the market starts demanding lower multiple risk for midstream.
• For income mandates, buy OKE only on a pullback of 5-8% or after a consolidation window; upside from here is likely slower than the last leg, but dividend support limits downside unless rates spike materially.