Oneok Partners, L.P. (OKS)

ONEOK (OKE -2.2%) is initiated with a Neutral rating at Credit Suisse, but 24/7's Jon Ogg thinks the call seems almost like a Buy rating in that the $41 price target implies a nearly 20% upside from today's price, plus a ~7% dividend yield.

The firm says OKE's prospects are improving sequentially, with a modest but improving distribution coverage ratio, and contract renegotiations could provide an added boost by year-end; another positive is a $4B-$5B capex backlog, on top of the $3B-$4B in execution.

OKE is the pure-play general partner of ONEOK Partners (OKS -2.1%), which Credit Suisse rates at Outperform with a $40 price target.

ONEOK Partners (NYSE:OKS) agrees to sell ~21.5M common units representing limited partner interests at a price of $30.17/unit in a private placement to parent company ONEOK (NYSE:OKE).

It's the approach I've been taking.

OKS looking extremely undersold and undervalued down here. the 9.5% dividend is attractive, and I am thinking of initiating a position.

Since 2005, ONEOK Partners has managed to boost distributions by 7.10% per year.

The partnership expects 10% - 15% annual distribution growth through 2015 and plans to maintain at least a 1.05 times distributable cash flow coverage.

Per its partnership agreement, the majority of available cash from operations should be distributed to general and limited partners.

@true glad to have your insights. Let's have a profitable year.

And thank you for the info on O&G stocks. I'm now following the board.

Trueheart

@Trueheart thanks for the note!

IF you have any oil & gas stocks of interest please stop by the board and share your ideas :)

Good luck here!

Trueheart

I like it for 2013.

Thanks for the post, JR. I bailed on it early last year.

Trueheart

Oneok Partners offers a compelling combination of both yield and growth.

While its 2012 share price performance was disappointing, I expect shares to perform much better in 2013 as expectations are much lowered.

After having a breakthrough year in 2011, Oneok's stock price stagnated in 2012.

For 2011, Oneok saw its stock surge 45%. However, in 2012, Oneok actually experienced a decline of 6%, from $57.50 to $54.00.

Even so, owners of Oneok stock during this time frame would have still outperformed the S&P, with Oneok's stock rising 35% and the S&P only gaining 12%.

Seems to have hit a selling wall the past few trading days. The company's story hasn't changed during that time.

Trueheart

I'm in. Couldn't pass up the growth and dividend.

Trueheart

FYI- Reason for pps change in July 2011.

ONEOK Partners (OKS) completed a two-for-one stock split on July 12, 2011.

The company connects NGL-supplies in the Mid-Continent and Rocky Mountain regions with key market centers. This provides the MLP with a low-risk and stable cash flow. ONEOK Partners provides contracted natural gas supplies, transportation services, and storage services.

OKS could see movement as a result of this big deal between El Paso and Kinder Morgan.