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1. Company Snapshot

1.a. 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.

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1.b. Last Insights on OGS

ONE Gas, Inc.'s recent performance is driven by strong earnings growth, with Q2 net income jumping 18% and EPS meeting estimates. The company's $750 million investments in 2025 and growing customer base support steady EPS estimates and dividend growth through 2029. A Zacks upgrade to a Buy rating reflects growing optimism about earnings prospects. The company's Q3 2025 financial results will be released on November 3, 2025. Regulated operations and strategic investments make a strong case for investment. (Source: Zacks)

1.c. Company Highlights

2. ONE Gas Delivers Strong Q4 Results, Introduces Non-GAAP Adjustments

ONE Gas reported a robust fourth quarter with adjusted net income of $90 million, or $1.48 per diluted share, surpassing analyst estimates of $1.42 per share. The company's full-year 2025 financial results were also strong, with net income totaling $264 million, or $4.37 per diluted share, compared to $223 million and $3.91 in 2024. Revenue growth is expected to be negative, with analysts estimating a decline of 2.1% for the next year.

Publication Date: Feb -20

📋 Highlights
  • and end with the description. Make sure figures are correctly included. </think> <li><b>Winter Storm Fern Performance:: Delivered 3 billion cubic feet of gas without supply disruptions, while increasing storage capacity to over 60 Bcf.
  • 2025 Full-Year Net Income:: Net income rose to $264M ($4.37/share) vs. $223M ($3.91/share) in 2024, with 2026 adjusted guidance of $306M–$314M ($4.83–$4.95/share).
  • Q4 2024 Adjusted Earnings:: Adjusted net income of $90M ($1.48/share) vs. $78M ($1.35/share) in Q4 2023, with full-year adjusted net income at $271M ($4.48/share).
  • Texas Rate Case Outcome:: Final order approved a $14.4M revenue increase, 9.8% return on equity, and 59.9% equity ratio, with GRIP and PBR filings planned in Q1 2025.
  • Kansas GSRS Filing Impact:: Proposed legislation would increase GSRS filing by $2.55M to $1.35, including safety/system integrity expenditures but excluding corporate allocations.

Operational Highlights

The company's operational performance was impressive, particularly during Winter Storm Fern, where it delivered over 3 billion cubic feet of gas to customers without any supply disruptions. ONE Gas has also increased its storage capacity to over 60 Bcf and diversified its gas supply, reducing the impact of price fluctuations on customers. As Curtis Dinan noted, the company is "competitively advantaged in some situations due to assets we already have nearby to the opportunity."

Regulatory Developments

A significant development for ONE Gas is the proposed Kansas legislation, which would allow the company to include safety-related expenditures, system integrity work, and cybersecurity in its GSRS filing. This could result in a substantial increase in the filing, from $0.80 to $1.35, a $2.55 million increase. The company's Texas rate case outcome was also favorable, with a $14.4 million revenue increase and a 9.8% return on equity.

Valuation and Outlook

With a P/E Ratio of 19.51 and an EV/EBITDA of 7.8, ONE Gas appears to be reasonably valued. The company's Dividend Yield is 3.13%, which is attractive for income investors. Christopher Sighinolfi discussed the company's growth rate range, noting that they had previously guided to the high end of the range but this year to the midpoint. The company's guidance for 2026 assumes the latest Texas rate case outcome, and the cash component of the higher earnings is expected to be reflected in the GRIP filing.

Financial Metrics

ONE Gas' return on equity (ROE) is 8.14%, and its return on invested capital (ROIC) is 4.53%. The company's Net Debt / EBITDA ratio is 1.22, indicating a manageable level of debt. Overall, ONE Gas' strong operational performance, favorable regulatory developments, and reasonable valuation make it an attractive investment opportunity.

3. NewsRoom

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Elo Mutual Pension Insurance Co Has $992,000 Holdings in ONE Gas, Inc. $OGS

Mar -06

Source: defenseworld.net

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ONE Gas to Participate in UBS, Morgan Stanley and Jefferies Conferences

Feb -24

Source: prnewswire.com

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ONE Gas (OGS) is a Top Dividend Stock Right Now: Should You Buy?

Feb -23

Source: zacks.com

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ONE Gas Sets Record Date for 2026 Annual Meeting of Shareholders

Feb -20

Source: prnewswire.com

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ONE Gas, Inc. (OGS) Q4 2025 Earnings Call Transcript

Feb -19

Source: seekingalpha.com

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ONE Gas Q4 Earnings Beat Estimates, Revenues Increase Y/Y

Feb -19

Source: zacks.com

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ONE Gas (OGS) Reports Q4 Earnings: What Key Metrics Have to Say

Feb -19

Source: zacks.com

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ONE Gas (OGS) Q4 Earnings and Revenues Top Estimates

Feb -18

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.75%)

6. Segments

Natural Gas

Expected Growth: 8%

ONE Gas, Inc.'s 8% growth in Natural Gas is driven by increasing demand from industrial and power generation customers, expansion into new markets, and strategic infrastructure investments. Additionally, favorable weather patterns and rising LNG exports contribute to the growth. Furthermore, the company's focus on operational efficiency and cost savings initiatives also support the growth momentum.

Transportation

Expected Growth: 6%

ONE Gas, Inc.'s 6% growth in Transportation is driven by increasing natural gas demand, expansion of pipeline infrastructure, and rising production from shale plays. Additionally, favorable regulatory environments, growing LNG exports, and investments in pipeline modernization also contribute to this growth.

Securitization

Expected Growth: 5%

ONE Gas, Inc.'s securitization growth is driven by increasing demand for natural gas, strategic acquisitions, and infrastructure investments. Additionally, favorable regulatory environments, declining commodity prices, and a strong balance sheet enable the company to capitalize on growth opportunities, resulting in a 5% growth rate.

Miscellaneous

Expected Growth: 4%

ONE Gas, Inc.'s Miscellaneous segment growth is driven by increasing investments in infrastructure, rising demand for natural gas, and favorable regulatory environments. Additionally, the company's focus on cost savings initiatives and operational efficiencies contribute to the 4% growth rate.

Other

Expected Growth: 3%

ONE Gas, Inc.'s 'Other' segment growth is driven by increasing adoption of compressed natural gas (CNG) and liquefied natural gas (LNG) for transportation, rising demand for natural gas infrastructure, and growing investments in renewable energy projects, contributing to a 3% growth rate.

Other - Natural Gas Related

Expected Growth: 7%

ONE Gas, Inc.'s 7% growth in Other - Natural Gas Related segment is driven by increasing demand for natural gas in the Midwest and Kansas regions, coupled with strategic infrastructure investments and acquisitions. Additionally, favorable weather patterns and rising industrial activity contribute to the growth, as ONE Gas expands its customer base and optimizes its operations.

7. Detailed Products

Natural Gas Distribution

ONE Gas, Inc. provides natural gas distribution services to residential, commercial, and industrial customers in Oklahoma, Kansas, and Texas.

Pipeline Transportation

The company operates an intrastate pipeline system that transports natural gas to its distribution system and to other customers.

Natural Gas Storage

ONE Gas, Inc. owns and operates natural gas storage facilities that provide storage services to its distribution system and to other customers.

Gas Gathering

The company provides gas gathering services to natural gas producers, transporting natural gas from production areas to processing facilities.

8. ONE Gas, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for ONE Gas, Inc. is low due to the lack of alternative energy sources that can replace natural gas in the short term.

Bargaining Power Of Customers

The bargaining power of customers for ONE Gas, Inc. is medium due to the presence of a large number of customers, but the company's ability to negotiate prices and terms.

Bargaining Power Of Suppliers

The bargaining power of suppliers for ONE Gas, Inc. is low due to the company's ability to negotiate prices and terms with its suppliers.

Threat Of New Entrants

The threat of new entrants for ONE Gas, Inc. is low due to the high barriers to entry in the natural gas distribution industry, including the need for significant capital investment and regulatory approvals.

Intensity Of Rivalry

The intensity of rivalry for ONE Gas, Inc. is medium due to the presence of a few large competitors in the natural gas distribution industry, but the company's ability to differentiate itself through its customer service and operational efficiency.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 52.49%
Debt Cost 4.63%
Equity Weight 47.51%
Equity Cost 7.14%
WACC 5.82%
Leverage 110.46%

11. Quality Control: ONE Gas, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
ONE Gas

A-Score: 6.4/10

Value: 6.4

Growth: 4.4

Quality: 4.8

Yield: 6.0

Momentum: 7.0

Volatility: 10.0

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Atmos Energy

A-Score: 6.3/10

Value: 4.9

Growth: 5.0

Quality: 5.7

Yield: 4.0

Momentum: 8.0

Volatility: 10.0

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New Jersey Resources

A-Score: 6.3/10

Value: 6.3

Growth: 4.3

Quality: 4.4

Yield: 8.0

Momentum: 4.5

Volatility: 10.0

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NiSource

A-Score: 6.2/10

Value: 5.3

Growth: 3.3

Quality: 4.7

Yield: 6.0

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

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Southwest Gas Holdings

A-Score: 6.1/10

Value: 4.3

Growth: 5.2

Quality: 3.6

Yield: 7.0

Momentum: 7.0

Volatility: 9.7

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New Fortress Energy

A-Score: 3.9/10

Value: 10.0

Growth: 6.4

Quality: 3.4

Yield: 3.0

Momentum: 0.0

Volatility: 0.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

87.15$

Current Price

87.15$

Potential

-0.00%

Expected Cash-Flows