ONE Gas (OGS) AI Stock Analysis

• Market Cap: $4.70B
• Dividend Yield: 3.44%
• Average Volume (3M): 419.26K
• Price to Earnings (P/E): 18.5
• Beta (1Y): 0.26
• Revenue Growth: 13.43%
• EPS Growth: 6.49%
• Country: US
• Employees: 3,900
• Sector: Utilities
• Sector Strength: 65
• Industry: Regulated Gas
• EPS (TTM): 0.53
• Shares Outstanding: 59,998,367
• 10 Day Avg. Volume: 362,071
• 30 Day Avg. Volume: 419,259
• PEG Ratio: -3.06
• Price to Book (P/B): 1.27
• Price to Sales (P/S): 1.89
• P/FCF Ratio: -11.76
• Enterprise Value/Market Cap: 1.61
• Enterprise Value/Revenue: 3.25
• Enterprise Value/Gross Profit: 6.08
• Enterprise Value/Ebitda: 10.09
• 1Y Price Target: $80.00
• Price Target Upside: 3.17% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 68 Neutral
• Price Target: $81.00 ▲(4.46% Upside)

ONE Gas shows strong financial performance and raised guidance, supported by regulatory progress and customer growth. However, challenges in cash flow and increased operating expenses need attention. The stock's valuation is reasonable, and technical indicators suggest a stable outlook.

Positive Factors

Regulatory Progress

Effective regulatory engagement has led to significant revenue increases, enhancing long-term financial stability and supporting infrastructure investments.

Customer Base Expansion

A growing customer base indicates increased demand and market penetration, which can drive revenue growth and improve economies of scale over time.

Improved Leverage

A lower debt-to-equity ratio reflects reduced financial risk and improved balance sheet health, providing more flexibility for future investments.

Negative Factors

Increased Operating Expenses

Rising operating expenses can pressure margins and reduce profitability, necessitating efficient cost management to sustain long-term growth.

Negative Free Cash Flow

Negative free cash flow indicates potential liquidity issues, limiting the company's ability to fund operations and growth without external financing.

Weather-Related Challenges

Weather-related disruptions can impact service delivery and operational costs, highlighting the need for robust risk management strategies.

ONE Gas Business Overview & Revenue Model

Company Description

ONE Gas, Inc., together with its subsidiaries, operates as a regulated natural gas distribution utility company in the United States. The company operates through three divisions: Oklahoma Natural Gas, Kansas Gas Service, and Texas Gas Service. It provides natural gas distribution services to 2.2 million customers in three states. It serves residential, commercial, and transportation customers. As of December 31, 2021, it operated approximately 41,600 miles of distribution mains; and 2,400 miles of transmission pipelines, as well as had 51.4 billion cubic feet of natural gas storage capacity. ONE Gas, Inc. was founded in 1906 and is headquartered in Tulsa, Oklahoma.

How the Company Makes Money

ONE Gas generates revenue primarily through the distribution of natural gas to its customers. The company charges customers based on their natural gas consumption, which is measured through meters installed at their premises. Additionally, ONE Gas earns revenue from transportation services for moving natural gas through its pipeline network. The company also benefits from regulatory mechanisms that allow it to recover costs associated with infrastructure investments and maintenance. Significant partnerships with natural gas suppliers and local governments further enhance its ability to serve customers efficiently and secure favorable pricing, contributing to its overall profitability.

ONE Gas Financial Statement Overview

Summary

ONE Gas demonstrates strong revenue growth and profitability with a solid gross profit margin and stable net profit margin. However, challenges in cash flow generation and operational efficiency, as indicated by negative free cash flow and decreased EBIT and EBITDA margins, need attention.

Income Statement

ONE Gas shows a solid gross profit margin of 53.45% in the TTM, indicating efficient cost management. The net profit margin is stable at 10.63%, reflecting consistent profitability. Revenue growth of 3.08% in the TTM suggests a positive trajectory, recovering from previous declines. However, the EBIT and EBITDA margins have slightly decreased compared to previous years, indicating potential pressure on operational efficiency.

Balance Sheet

The debt-to-equity ratio has improved significantly to 0.27 in the TTM, showcasing a strong reduction in leverage and improved financial stability. Return on equity is moderate at 8.07%, indicating decent profitability relative to equity. The equity ratio is stable, reflecting a balanced capital structure. However, the company has experienced fluctuations in debt levels over the years, which could pose risks if not managed carefully.

Cash Flow

Operating cash flow remains positive, but the free cash flow is negative in the TTM, indicating potential challenges in generating surplus cash after capital expenditures. The operating cash flow to net income ratio is 0.43, suggesting moderate cash conversion efficiency. The negative free cash flow growth and free cash flow to net income ratio indicate potential liquidity concerns that need addressing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.33B	2.08B	2.37B	2.58B	1.81B	1.53B
Gross Profit	1.25B	775.11M	729.08M	646.65M	583.91M	561.71M
EBITDA	750.89M	703.17M	666.90M	574.25M	514.28M	493.33M
Net Income	247.74M	222.85M	231.23M	221.74M	206.43M	196.41M
Balance Sheet
Total Assets	8.36B	8.43B	7.77B	7.78B	8.40B	6.03B
Cash, Cash Equivalents and Short-Term Investments	42.72M	57.99M	18.84M	9.68M	8.85M	7.99M
Total Debt	3.27B	3.33B	3.07B	3.23B	4.18B	2.00B
Total Liabilities	2.80B	5.32B	5.01B	5.19B	6.05B	3.80B
Stockholders Equity	3.18B	3.10B	2.77B	2.58B	2.35B	2.23B
Cash Flow
Free Cash Flow	-137.81M	-334.75M	272.90M	961.36M	-2.03B	-106.84M
Operating Cash Flow	566.29M	368.41M	939.53M	1.57B	-1.54B	364.50M
Investing Cash Flow	-714.23M	-707.50M	-669.64M	-614.11M	-501.08M	-470.37M
Financing Cash Flow	158.19M	378.23M	-248.63M	-947.46M	2.04B	96.01M

ONE Gas Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 77.54
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OGS, the sentiment is Positive. The current price of 77.54 is above the 20-day moving average (MA) of 75.89, above the 50-day MA of 74.69, and above the 200-day MA of 72.55, indicating a bullish trend. The MACD of 0.65 indicates Negative momentum. The RSI at 61.03 is Neutral, neither overbought nor oversold. The STOCH value of 86.47 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OGS.

ONE Gas Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NJR	76 Outperform	4.76B	11.57	13.17%	3.86%	21.88%	71.35%
SR	71 Outperform	4.65B	17.03	8.21%	3.99%	-6.65%	11.47%
NWN	71 Outperform	1.78B	17.23	7.08%	4.49%	8.40%	17.90%
CPK	70 Outperform	3.10B	23.46	8.60%	2.01%	19.02%	20.13%
OGS	68 Neutral	$4.70B	18.47	8.24%	3.44%	13.43%	6.49%
SWX	67 Neutral	5.71B	29.54	5.27%	3.18%	-10.07%	5.98%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%

ONE Gas Corporate Events

ONE Gas Secures $250 Million Term Loan Facility

On August 11, 2025, ONE Gas, Inc. entered into a credit agreement with Bank of America, N.A. and other lenders for a $250 million unsecured term loan facility. The loan will be used for working capital, capital expenditures, acquisitions, mergers, and other corporate purposes, maturing in September 2026. This agreement includes various financial covenants and conditions, with potential impacts on the company’s financial operations and relationships with lenders, who have previously provided financial services to the company.

ONE Gas Reports Strong Q2 2025 Financial Results

On August 5, 2025, ONE Gas announced its financial results for the second quarter of 2025, reporting a net income of $32.0 million, up from $27.2 million in the same quarter of 2024. The company also increased its 2025 financial guidance, reflecting strong operational performance and effective cost management. Additionally, ONE Gas declared a quarterly dividend and highlighted regulatory activities, including rate cases and infrastructure program filings in Texas, Kansas, and Oklahoma, which are expected to impact future revenues and service rates.

ONE Gas Announces Quarterly Dividend Declaration

On August 4, 2025, ONE Gas, Inc. announced that its board of directors declared a quarterly cash dividend of 67 cents per share of common stock, payable on September 3, 2025, to shareholders of record as of August 18, 2025. The company expects this dividend rate to continue through 2025, with an annual growth of 1% to 2% projected through 2029, and aims for a dividend payout ratio of approximately 55% to 65% of net income, subject to board approval.

ONE Gas to Release Q2 2025 Financial Results

On July 2, 2025, ONE Gas announced it will release its second quarter 2025 financial results on August 5, 2025, after market close. The company will host a conference call the following day, August 6, 2025, to discuss the results, which will be accessible via their website. This announcement is part of ONE Gas’s ongoing efforts to maintain transparency with stakeholders and provide timely updates on its financial performance.

ONE Gas Announces Senior Leadership Transition

On July 1, 2025, ONE Gas announced the retirement of Joseph L. McCormick, its senior vice president, general counsel, and assistant secretary, effective October 1, 2025. Regina L. Gregory will succeed him, initially serving as a senior advisor from July 16, 2025, before assuming McCormick’s roles upon his retirement. McCormick has been a pivotal figure in the company for over 20 years, significantly influencing its legal and strategic direction. Gregory, with extensive experience in legal and corporate leadership, is expected to maintain the company’s high standards and contribute strategically to its future.

ONE Gas to Participate in European Investment Forums

ONE Gas announced on June 9, 2025, that it will participate in the American Gas Association and Jefferies Europe Mini-Forum on June 16-17, 2025, in London and Zurich. The company’s executives, including the CEO and CFO, will engage with the investment community, potentially enhancing the company’s visibility and investor relations.