ONE Gas (OGS) Unveils 2024 and Long-Term Investment Plan
ONE Gas, Inc. OGS announced its 2024 financial goals and updated its following five-year growth rates. The company is planning to strengthen its infrastructure further and efficiently execute its business strategy, which will enable it to meet customer demands.
2024 Guidance
Taking into account the benefit of new rates and customer growth and the negative impact of higher operating expenses, ONE Gas currently expects 2024 net income to be in the range of $214-$231 million, with earnings per diluted share of $3.70 to $4.00.
ONE Gas’ 2024 capital investment, including asset removal costs, is expected to be around $750 million. Capital investments for extensions to new customers are expected to be nearly $170 million, primarily due to continued growth opportunities in Texas and Oklahoma.
Long-term Investment
ONE Gas expects its capital expenditure for the 2024-2028 time period to be $4.25 billion or in the range of $750-$950 million per year. The long-term capital expenditure includes capital growth of $1.1 billion. The current long-term investment plan is an improvement from its previous five-year investment target of $3.6 billion for the 2023-2027 time period.
Net income is expected to increase by an average of 7-9% annually through 2028, with diluted earnings per share of 4-6%. Operating costs over the next five years are expected to increase on average by nearly 5% per year.
Subject to the approval of its board of directors, the company expects to achieve an average annual dividend growth rate of 1-2% through 2028.
Price Performance
In the past six months, shares of ONE Gas have lost 27.7% compared with the industry’s 7.6% decline.
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Zacks Rank & Key Picks
ONE Gas currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Utilities sector are Consolidated Edison ED, NiSource NI and PPL Corporation PPL, each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The long-term (three- to five-year) earnings growth of Consolidated Edison, NiSource and PPL is pegged at 2%, 7.1% and 7.4%, respectively.
The Zacks Consensus Estimate for 2023 earnings for Consolidated Edison, NiSource and PPL reflects year-over-year growth of 8.6%, 8.8% and 12.1%, respectively.
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