Common Stock Valuation Ratios (Price Multiples)
Valuation ratios measure the quantity of an asset or flaw (e.g., earnings) associated with ownership of a specified claim (e.g., a share of ownership of the enterprise).
Current Valuation Ratios
ONEOK Inc., current price multiples
| ONEOK Inc. | Chevron Corp. | ConocoPhillips | Exxon Mobil Corp. | Oil, Gas & Consumable Fuels | Energy | ||||
|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data | |||||||||
| Current share price (P) | $64.15 | ||||||||
| No. shares of common stock outstanding | 447,674,825 | ||||||||
| Growth rate (g) | -1.96% | ||||||||
| Earnings per share (EPS) | $3.84 | ||||||||
| Next year expected EPS | $3.77 | ||||||||
| Operating profit per share | $6.27 | ||||||||
| Sales per share | $50.01 | ||||||||
| Book value per share (BVPS) | $14.51 | ||||||||
| Valuation Ratios (Price Multiples) | |||||||||
| Price to earnings (P/E) | 16.69 | 33.01 | 19.26 | 22.98 | 11.13 | 11.47 | |||
| Price to next year expected earnings | 17.02 | 31.57 | 17.17 | 21.21 | 10.02 | 10.33 | |||
| Price to operating profit (P/OP) | 10.23 | 19.09 | 11.36 | 15.68 | 7.72 | 8.00 | |||
| Price to sales (P/S) | 1.28 | 2.20 | 2.61 | 2.05 | 1.72 | 1.75 | |||
| Price to book value (P/BV) | 4.42 | 2.18 | 2.39 | 2.56 | 3.04 | 3.09 | |||
Based on: 10-K (reporting date: 2022-12-31).
If the company price multiple is lower then the price multiple of benchmark then company stock is relatively undervalued.
Otherwise, if the company price multiple is higher then the price multiple of benchmark then company stock is relatively overvalued.
Historical Valuation Ratios (Summary)
ONEOK Inc., historical price multiples
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).
The valuation multiples exhibit a general trend of contraction between 2018 and 2022, characterized by a notable decline in earnings and sales multiples following peaks in 2019 and 2020.
- Price to Earnings (P/E)
- The P/E ratio demonstrated significant volatility, peaking at 33.19 in 2020 before experiencing a sharp correction. By the end of 2022, the ratio declined to 17.01, representing the lowest valuation relative to earnings in the observed five-year period.
- Price to Operating Profit (P/OP)
- The P/OP ratio remained relatively stable between 2018 and 2020, fluctuating within a range of 14.42 to 15.89. A downward shift occurred in 2021, with the ratio decreasing to 10.97 and further to 10.43 in 2022, indicating a compression in the multiple applied to operating profits.
- Price to Sales (P/S)
- A consistent downward trajectory is observed in the P/S ratio following a peak of 2.99 in 2019. The ratio decreased steadily each subsequent year, reaching 1.31 by December 31, 2022, which suggests a reduction in market valuation relative to top-line revenue.
- Price to Book Value (P/BV)
- The P/BV ratio exhibited fluctuation without a definitive linear trend. It reached a high of 4.89 in 2019 and a low of 3.36 in 2020, before recovering to 4.73 in 2021 and settling at 4.51 in 2022.
Overall, the simultaneous decline in P/E, P/OP, and P/S ratios suggests a broad valuation compression across income-based metrics, while the P/BV ratio indicates a more stable relationship between the market price and the company's equity base.
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Price to Earnings (P/E)
ONEOK Inc., historical P/E calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 447,220,972 | 446,213,285 | 444,983,595 | 413,319,000 | 411,611,382 | |
| Selected Financial Data (US$) | ||||||
| Net income available to common shareholders (in thousands) | 1,721,121) | 1,498,606) | 611,709) | 1,277,477) | 1,150,603) | |
| Earnings per share (EPS)2 | 3.85 | 3.36 | 1.37 | 3.09 | 2.80 | |
| Share price1, 3 | 65.45 | 63.82 | 45.62 | 73.61 | 64.29 | |
| Valuation Ratio | ||||||
| P/E ratio4 | 17.01 | 19.00 | 33.19 | 23.82 | 23.00 | |
| Benchmarks | ||||||
| P/E Ratio, Competitors5 | ||||||
| Chevron Corp. | 8.71 | 16.81 | — | — | — | |
| ConocoPhillips | 7.07 | 14.66 | — | — | — | |
| Exxon Mobil Corp. | 8.01 | 14.11 | — | — | — | |
| P/E Ratio, Sector | ||||||
| Oil, Gas & Consumable Fuels | 8.08 | 15.11 | — | — | — | |
| P/E Ratio, Industry | ||||||
| Energy | 8.54 | 15.67 | — | — | — | |
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).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
EPS = Net income available to common shareholders ÷ No. shares of common stock outstanding
= 1,721,121,000 ÷ 447,220,972 = 3.85
3 Closing price as at the filing date of ONEOK Inc. Annual Report.
4 2022 Calculation
P/E ratio = Share price ÷ EPS
= 65.45 ÷ 3.85 = 17.01
5 Click competitor name to see calculations.
The analysis of price multiples between 2018 and 2022 reveals a period of significant volatility followed by a compression in valuation multiples. While the share price and earnings per share experienced a sharp decline in 2020, the subsequent recovery period has been characterized by earnings growth outpacing share price appreciation.
- Price-to-Earnings (P/E) Ratio Trend
- A notable fluctuation in the P/E ratio is observed, peaking at 33.19 in 2020 before declining to 17.01 by 2022. The peak in 2020 was driven by a disproportionate decrease in earnings relative to the share price, which mathematically inflated the multiple. From 2021 onward, a consistent downward trend in the ratio indicates a contraction in the valuation multiple despite improving fundamentals.
- Earnings Per Share (EPS) Performance
- EPS exhibited a significant contraction from 3.09 in 2019 to 1.37 in 2020. However, a strong recovery followed, with EPS increasing to 3.36 in 2021 and reaching 3.85 by 2022. This represents a substantial increase in profitability compared to the 2018 baseline of 2.80.
- Share Price and Valuation Correlation
- The share price mirrored the trajectory of earnings, falling to a low of 45.62 in 2020 and recovering to 65.45 by 2022. Because the 2022 share price returned to levels similar to 2018 (64.29) while the earnings per share grew significantly (from 2.80 to 3.85), the resulting P/E ratio decreased from 23.00 to 17.01, suggesting a more conservative market valuation relative to current earnings capacity.
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Price to Operating Profit (P/OP)
ONEOK Inc., historical P/OP calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 447,220,972 | 446,213,285 | 444,983,595 | 413,319,000 | 411,611,382 | |
| Selected Financial Data (US$) | ||||||
| Operating income (in thousands) | 2,807,419) | 2,596,259) | 1,361,357) | 1,914,353) | 1,835,464) | |
| Operating profit per share2 | 6.28 | 5.82 | 3.06 | 4.63 | 4.46 | |
| Share price1, 3 | 65.45 | 63.82 | 45.62 | 73.61 | 64.29 | |
| Valuation Ratio | ||||||
| P/OP ratio4 | 10.43 | 10.97 | 14.91 | 15.89 | 14.42 | |
| Benchmarks | ||||||
| P/OP Ratio, Competitors5 | ||||||
| Chevron Corp. | 6.12 | 11.40 | — | — | — | |
| ConocoPhillips | 4.57 | 8.66 | — | — | — | |
| Exxon Mobil Corp. | 5.65 | 9.86 | — | — | — | |
| P/OP Ratio, Sector | ||||||
| Oil, Gas & Consumable Fuels | 5.60 | 10.13 | — | — | — | |
| P/OP Ratio, Industry | ||||||
| Energy | 5.95 | 10.52 | — | — | — | |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
Operating profit per share = Operating income ÷ No. shares of common stock outstanding
= 2,807,419,000 ÷ 447,220,972 = 6.28
3 Closing price as at the filing date of ONEOK Inc. Annual Report.
4 2022 Calculation
P/OP ratio = Share price ÷ Operating profit per share
= 65.45 ÷ 6.28 = 10.43
5 Click competitor name to see calculations.
Between 2018 and 2022, the valuation based on operating profit exhibited a transition from a higher multiple to a more compressed valuation, despite a recovery in both share price and operational earnings following a 2020 trough.
- Share Price and Operating Profit Correlation
- A significant contraction occurred in 2020, with the share price declining to 45.62 US$ and operating profit per share falling to 3.06 US$. Both metrics recovered substantially by the end of 2022, with the share price reaching 65.45 US$ and operating profit per share increasing to 6.28 US$.
- Price to Operating Profit (P/OP) Trend
- The P/OP ratio peaked in 2019 at 15.89 and remained relatively elevated through 2020 at 14.91. However, a marked downward trend is observed in 2021 and 2022, with the ratio falling to 10.97 and 10.43, respectively.
- Valuation Divergence
- The decline in the P/OP ratio during the final two years of the period indicates that operating profit grew at a faster rate than the market price of the stock. While the share price returned to levels comparable to 2018, the operating profit per share significantly exceeded its 2018 baseline, resulting in a lower price multiple relative to the actual operational performance.
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Price to Sales (P/S)
ONEOK Inc., historical P/S calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 447,220,972 | 446,213,285 | 444,983,595 | 413,319,000 | 411,611,382 | |
| Selected Financial Data (US$) | ||||||
| Revenues (in thousands) | 22,386,892) | 16,540,309) | 8,542,242) | 10,164,367) | 12,593,196) | |
| Sales per share2 | 50.06 | 37.07 | 19.20 | 24.59 | 30.59 | |
| Share price1, 3 | 65.45 | 63.82 | 45.62 | 73.61 | 64.29 | |
| Valuation Ratio | ||||||
| P/S ratio4 | 1.31 | 1.72 | 2.38 | 2.99 | 2.10 | |
| Benchmarks | ||||||
| P/S Ratio, Competitors5 | ||||||
| Chevron Corp. | 1.31 | 1.69 | — | — | — | |
| ConocoPhillips | 1.68 | 2.58 | — | — | — | |
| Exxon Mobil Corp. | 1.12 | 1.17 | — | — | — | |
| P/S Ratio, Sector | ||||||
| Oil, Gas & Consumable Fuels | 1.24 | 1.48 | — | — | — | |
| P/S Ratio, Industry | ||||||
| Energy | 1.31 | 1.52 | — | — | — | |
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).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
Sales per share = Revenues ÷ No. shares of common stock outstanding
= 22,386,892,000 ÷ 447,220,972 = 50.06
3 Closing price as at the filing date of ONEOK Inc. Annual Report.
4 2022 Calculation
P/S ratio = Share price ÷ Sales per share
= 65.45 ÷ 50.06 = 1.31
5 Click competitor name to see calculations.
The evaluation of price multiples from 2018 to 2022 reveals a significant compression in the Price to Sales (P/S) ratio, which declined from 2.10 in 2018 to 1.31 by the end of 2022. This trend indicates that the market is assigning a lower multiple to each dollar of revenue generated per share over the five-year period.
- Revenue Generation Trends
- Sales per share exhibited a U-shaped trajectory, declining from 30.59 US$ in 2018 to a low of 19.20 US$ in 2020, before experiencing a sharp acceleration to 50.06 US$ by 2022. This substantial increase in revenue per share during the final two years of the period served as the primary driver for the declining valuation multiple.
- Equity Valuation Patterns
- The share price demonstrated volatility, peaking at 73.61 US$ in 2019 and reaching a trough of 45.62 US$ in 2020. While the price recovered to 65.45 US$ by 2022, the recovery did not keep pace with the growth in sales per share, contributing to a lower overall P/S ratio.
- Price to Sales Ratio Dynamics
- The P/S ratio reached its maximum of 2.99 in 2019, a period characterized by peak share prices and contracting sales. Subsequently, a consistent downward trend is observed from 2019 through 2022. The reduction of the ratio to 1.31 in 2022 suggests a valuation shift where the equity is trading at a more conservative multiple of its sales compared to the 2018–2020 period.
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Price to Book Value (P/BV)
ONEOK Inc., historical P/BV calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 447,220,972 | 446,213,285 | 444,983,595 | 413,319,000 | 411,611,382 | |
| Selected Financial Data (US$) | ||||||
| Total ONEOK shareholders’ equity (in thousands) | 6,493,885) | 6,015,163) | 6,042,398) | 6,225,951) | 6,579,543) | |
| Book value per share (BVPS)2 | 14.52 | 13.48 | 13.58 | 15.06 | 15.98 | |
| Share price1, 3 | 65.45 | 63.82 | 45.62 | 73.61 | 64.29 | |
| Valuation Ratio | ||||||
| P/BV ratio4 | 4.51 | 4.73 | 3.36 | 4.89 | 4.02 | |
| Benchmarks | ||||||
| P/BV Ratio, Competitors5 | ||||||
| Chevron Corp. | 1.94 | 1.89 | — | — | — | |
| ConocoPhillips | 2.75 | 2.61 | — | — | — | |
| Exxon Mobil Corp. | 2.29 | 1.93 | — | — | — | |
| P/BV Ratio, Sector | ||||||
| Oil, Gas & Consumable Fuels | 2.21 | 2.00 | — | — | — | |
| P/BV Ratio, Industry | ||||||
| Energy | 2.30 | 2.07 | — | — | — | |
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).
1 Data adjusted for splits and stock dividends.
2 2022 Calculation
BVPS = Total ONEOK shareholders’ equity ÷ No. shares of common stock outstanding
= 6,493,885,000 ÷ 447,220,972 = 14.52
3 Closing price as at the filing date of ONEOK Inc. Annual Report.
4 2022 Calculation
P/BV ratio = Share price ÷ BVPS
= 65.45 ÷ 14.52 = 4.51
5 Click competitor name to see calculations.
The valuation multiples for the period between 2018 and 2022 indicate significant volatility in the market's assessment of equity relative to its book value. The Price to Book Value (P/BV) ratio shifted in close correlation with fluctuations in the share price, while the underlying book value per share experienced a more gradual decline followed by a partial recovery.
- Price to Book Value (P/BV) Analysis
- The P/BV ratio began at 4.02 in 2018 and peaked at 4.89 in 2019. A substantial contraction occurred in 2020, with the ratio dropping to its period low of 3.36. In the following two years, the ratio rebounded, reaching 4.73 in 2021 and settling at 4.51 by the end of 2022.
- Book Value per Share (BVPS) Trends
- A consistent downward trend in BVPS was observed from 2018 through 2021, decreasing from 15.98 to 13.48. This decline represents a reduction in the net asset value attributable to each share. However, this trend reversed in 2022, as BVPS increased to 14.52.
- Price and Valuation Correlation
- The volatility observed in the P/BV ratio was primarily driven by share price movements rather than changes in book value. The peak valuation in 2019 coincided with the highest share price of 73.61, while the valuation trough in 2020 aligned with the share price decline to 45.62. The recovery of the P/BV ratio in 2021 and 2022 was facilitated by a return of the share price to the 63.00–65.00 range, despite BVPS remaining lower than 2018 levels.
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