JPMorgan Downgrades ONEOK Inc (OKE) to Neutral
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JPMorgan analyst Jeremy Tonet downgraded ONEOK Inc (NYSE: OKE) from Overweight to Neutral with a price target of $37.00.
The analyst comments "The recent dual oil supply and demand shocks fundamentally altered the energy infrastructure outlook, with the resulting crude oil price collapse forcing producer curtailments, and even shut-in, significant levels of production. We anticipate extended Bakken production and midstream headwinds, especially for OKE, who dominates Bakken G&P and NGL takeaway capacity. While the 2Q trough appears appreciated, with a partial recovery into 3Q, we see a prolonged path before reaching returning to prior levels, as also highlighted by the JPM E&P team. As such, we anticipate a longer period of lower asset utilization, especially for projects recently placed inservice. While admitting that mgmt. notably exceeded our expectations last cycle and that OKE’s preeminent Bakken to Belvieu NGL value chain possesses significant torque to a recovery, we see a more balanced risk/reward picture for OKE."
Shares of ONEOK Inc closed at $36.02 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Downgrades
Related EntitiesJPMorgan, Bakken Formation, Crude Oil
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