Price to Operating Profit (P/OP)
since 2005
Calculation
ONEOK Inc., P/OP, long-term trends, calculation
| P/OP | = | Share price1, 2, 3 | ÷ | Operating profit per share1 | Operating profit per share1 | = | Operating income1 (in thousands) |
÷ | No. shares of common stock outstanding2 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 28, 2023 | 10.43 | = | 65.45 | ÷ | 6.28 | 6.28 | = | 2,807,419 | ÷ | 447,220,972 | |
| Mar 1, 2022 | 10.97 | = | 63.82 | ÷ | 5.82 | 5.82 | = | 2,596,259 | ÷ | 446,213,285 | |
| Feb 23, 2021 | 14.91 | = | 45.62 | ÷ | 3.06 | 3.06 | = | 1,361,357 | ÷ | 444,983,595 | |
| Feb 25, 2020 | 15.89 | = | 73.61 | ÷ | 4.63 | 4.63 | = | 1,914,353 | ÷ | 413,319,000 | |
| Feb 26, 2019 | 14.42 | = | 64.29 | ÷ | 4.46 | 4.46 | = | 1,835,464 | ÷ | 411,611,382 | |
| Feb 27, 2018 | 16.95 | = | 57.00 | ÷ | 3.36 | 3.36 | = | 1,380,895 | ÷ | 410,634,227 | |
| Feb 28, 2017 | 8.86 | = | 54.05 | ÷ | 6.10 | 6.10 | = | 1,285,676 | ÷ | 210,757,806 | |
| Feb 23, 2016 | 4.49 | = | 21.31 | ÷ | 4.74 | 4.74 | = | 996,159 | ÷ | 209,989,711 | |
| Feb 25, 2015 | 8.27 | = | 45.39 | ÷ | 5.49 | 5.49 | = | 1,143,571 | ÷ | 208,400,547 | |
| Feb 25, 2014 | 13.19 | = | 58.81 | ÷ | 4.46 | 4.46 | = | 926,734 | ÷ | 207,814,086 | |
| Feb 26, 2013 | 8.24 | = | 44.34 | ÷ | 5.38 | 5.38 | = | 1,102,500 | ÷ | 204,994,065 | |
| Feb 21, 2012 | 7.46 | = | 41.63 | ÷ | 5.58 | 5.58 | = | 1,158,913 | ÷ | 207,787,580 | |
| Feb 22, 2011 | 7.18 | = | 31.67 | ÷ | 4.41 | 4.41 | = | 944,017 | ÷ | 214,042,340 | |
| Feb 23, 2010 | 5.10 | = | 21.48 | ÷ | 4.21 | 4.21 | = | 894,640 | ÷ | 212,281,048 | |
| Feb 25, 2009 | 2.63 | = | 11.47 | ÷ | 4.36 | 4.36 | = | 917,004 | ÷ | 210,478,992 | |
| Feb 27, 2008 | 6.08 | = | 24.03 | ÷ | 3.95 | 3.95 | = | 822,543 | ÷ | 208,121,078 | |
| Mar 1, 2007 | 5.42 | = | 21.08 | ÷ | 3.89 | 3.89 | = | 861,566 | ÷ | 221,694,990 | |
| Mar 13, 2006 | 4.32 | = | 14.71 | ÷ | 3.41 | 3.41 | = | 798,972 | ÷ | 234,486,556 |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$
2 Data adjusted for splits and stock dividends.
3 Closing price as at the filing date of ONEOK Inc. Annual Report.
The financial trajectory from 2006 to 2023 is characterized by a general appreciation in share price accompanied by fluctuating operating profits, leading to significant shifts in the Price to Operating Profit (P/OP) valuation multiple.
- Share Price Trends
- A long-term upward trend is evident, with the share price rising from 14.71 USD in 2006 to 65.45 USD by 2023. This growth was interrupted by three distinct contractions: a sharp decline in 2009 to 11.47 USD, a significant drop in 2016 to 21.31 USD, and a temporary correction in 2021 to 45.62 USD. The peak valuation occurred in 2020 at 73.61 USD.
- Operating Profit Performance
- Operating profit per share remained relatively stable for the first decade, fluctuating between 3.41 USD and 5.58 USD. A peak of 6.10 USD was reached in 2017, followed by a notable decline to 3.36 USD in 2018. A further contraction occurred in 2021, reaching a period low of 3.06 USD, before recovering strongly to 6.28 USD by 2023.
- P/OP Ratio Analysis
- The P/OP ratio exhibits three distinct valuation regimes. From 2006 to 2013, the ratio remained largely conservative, typically ranging between 4.32 and 8.24, with a cyclical low of 2.63 in 2009. A period of high volatility followed between 2014 and 2017, where the ratio spiked to 13.19 in 2014 before crashing to 4.49 in 2016. Between 2018 and 2021, a sustained expansion in the multiple is observed, peaking at 16.95 in 2018 and remaining above 14.00 through 2021. Most recently, the ratio has moderated, settling between 10.97 and 10.43 in 2022 and 2023.
- Correlation Insights
- The divergence between share price and operating profit is most apparent between 2018 and 2021. During this window, the P/OP ratio increased substantially despite a decline in operating profit per share, suggesting that market valuation was driven by factors other than immediate operational earnings. Conversely, the stabilization of the P/OP ratio in 2023 coincides with the highest recorded operating profit per share (6.28 USD), indicating a return to valuation levels more closely aligned with fundamental earnings growth.
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