TULSA, OK – ONE Gas, Inc. (NYSE:OGS) has increased its revolving credit facility by $75 million, bringing the total commitments available to the Tulsa-based natural gas distributor to $1.275 billion, according to a filing with the Securities and Exchange Commission. The agreement, effective Thursday, was facilitated through the addition of Regions Bank as a lender.
The increase is part of an amendment to ONE Gas's existing $1.2 billion credit agreement, originally dated March 16, 2021. Bank of America (NYSE:BAC), N.A. continues to serve as the administrative agent, swing line lender, and letter of credit issuer. This arrangement underscores the ongoing relationships between ONE Gas and its lenders, many of whom provide a variety of financial services to the company, including acting as underwriters for note and equity issuances and dealers for the company's commercial paper program.
The current amendment leaves the other terms and conditions of the credit agreement unchanged. ONE Gas's decision to expand its credit facility comes as the company continues to manage its capital and financial operations amidst the evolving energy market dynamics.
The details of the lender joinder and commitment increase agreement, filed as Exhibit 10.1 with the SEC, highlight the administrative aspects of the increased credit line and the involvement of the additional lender. ONE Gas has not disclosed specific plans regarding the use of the additional funds made available through this expanded credit line.
In other recent news, ONE Gas Inc. has been the subject of noteworthy developments. The company recently reported a strong first quarter performance for 2024, with net income reaching $99 million. This comes despite a 5% increase in operations and maintenance expenses compared to the previous year. The company's revenue growth was driven by new rates and customer growth, and it remains on track to hit the midpoint of its 2024 financial guidance.
In other developments, ONE Gas has received a revised price target from Mizuho, now set at $65.00, up from the previous $64.00. Mizuho maintains a Neutral stance on the company's stock, acknowledging the challenges posed by higher short-term rates while also noting potential benefits, such as the possibility of higher capital costs bolstering return on equity in upcoming rate case decisions. The firm's revised price target reflects a cautious yet stable outlook for ONE Gas extending into 2026. These are among the recent developments for ONE Gas, providing investors with a clearer picture of the company's current standing and future prospects.
InvestingPro Insights
In light of ONE Gas, Inc.'s recent financial maneuvers, a closer look at the company's performance metrics and strategic outlook may offer investors additional context. According to InvestingPro data, ONE Gas currently holds a market capitalization of $3.63 billion and maintains a P/E ratio of 15.66, indicating a valuation that reflects its earnings potential. Notably, the company has been profitable over the last twelve months as of Q1 2024, with a basic EPS (Continuing Operations) of $4.08.
From an investment standpoint, an InvestingPro Tip highlights the company's track record of raising its dividend for 10 consecutive years, which may appeal to income-focused investors, especially with a current dividend yield of 4.2%. Additionally, the company's commitment to profitability is further underscored by analysts' forecasts that it will remain profitable this year.
Investors considering ONE Gas as part of their portfolio may find additional insights and tips on the company's financial health and future prospects on InvestingPro, including a comprehensive analysis of short term obligations versus liquid assets. For those looking to delve deeper into ONE Gas's financial metrics, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. Moreover, there are several more InvestingPro Tips available, offering a broader perspective on the company's financial standing and strategic direction.
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