Did you catch the Academy Awards show? One Battle After Another was the big winner, taking home six Oscars, including Best Picture. I’m a film buff, but don’t really care for stuffy awards presentations… except for the Heisman Trophy and other sporting achievements.

One of my favorites is the MLB “Comeback Player of the Year”, which is bestowed annually on struggling, but determined athletes that make miraculous turnarounds. Many are former standouts sidelined by injury that grind their way back to the top.

For the second straight year, the National League award went to an Atlanta Braves player in Ronald Acuna. The slugging outfielder bounced back from a season-ending knee injury in 2024 to hit nearly .300 in 2025 and earn a spot on the All-Star team.

As a contrarian value investor, I’m always on the lookout for downtrodden stocks with similar rebound potential. It comes with the territory. After all, underpriced stocks usually get that way for a reason, so buyers must place their faith in companies that aren’t currently playing their best. Maybe they need the financial equivalent of Tommy John surgery to mend something broken.

It happens.

Sometimes, faltering businesses just need a little time to get back on track… and prove the skeptics wrong. But unlike sports writers, investors don’t have the luxury of hindsight. We must spot turnaround candidates before they regain their form, not after the stats have been written.

Twelve months ago, I chose Polaris (NYSE: PII) as my Comeback Award contender for 2025. At the time, the maker of off-road vehicles was mired in a terrible sales slump. Bearish investors had jumped ship, driving the shares down more than 40%.

But I saw tangible signs of improvement on the horizon. And Polaris delivered. The $45 stock went on to finish the year at $66 – rallying nearly 50%.

Sweet Redemption
My selection this year is Oneok (NYSE: OKE).

The normally reliable business didn’t exactly bring its ‘A’ game last year. Not that $5.7 billion in operating income was a huge disappointment. But fears of overspending sent the stock tumbling from triple-digit territory back down below $70. In any case, that was yesterday.

I think Oneok is on the road to recovery. Even before the Iran war disrupted global oil and gas supply chains and sent prices soaring, the midstream energy specialist was already in an advantageous spot.

Oneok operates 60,000 miles of gathering and distribution pipelines — enough to circle the globe two and a half times. That’s in addition to a vast collection of processing facilities, fractionation plants, and storage systems stretching from the Gulf Coast to the Rocky Mountains.

This entrenched network has never been busier.

In an average day, Oneok transports 1.8 million barrels of crude oil, delivers 1.6 million barrels of refined products (like gasoline and diesel), and handles 6 billion cubic feet of natural gas processing. Keep in mind, this is a business built around product volume, not volatile commodity prices.

So when throughput climbs, so do the contractual and government-regulated fees Oneok collects.

Given the collapsing stock price, you’d think profits would be in the tank. But that’s not the case – quite the opposite. The company just posted year-end results that showed a healthy 11% increase in earnings. EBITDA jumped 18%, topping $8 billion for the first time.

Oneok has now officially posted 12 consecutive years of rising EBITDA. From 2013 through 2024, this key cash flow metric expanded at a healthy 16% annualized growth rate – so the pace has quickened.

In turn, management just confidently hiked the dividend yet again. Quarterly distributions are now set at $1.07 per share, or $4.28 annualized — elevating the yield to 5.0%. This year’s expected earnings of $5.45 per share provide a comfortable coverage ratio of 127%.

So then why has the stock been sagging?

As I mentioned, a great deal of the selling pressure is tied to Oneok’s aggressive expansion plans. The past year has brought $3.1 billion in capital expenditures. Just $0.6 billion of that total went towards routine maintenance, meaning close to $2.5 billion was invested in various expansion projects.

This is an industry that occasionally bites off more than it can chew. Hence the market jitters. But Oneok’s spending is disciplined, focused only on the highest-return projects. Furthermore, most of the financing has been internal rather than external – it maintains a stout, investment-grade balance sheet with conservative debt leverage.

One of the latest organic growth initiatives is the Eiger Express Pipeline, a 450-mile artery carrying natural gas from the Permian Basin to a processing and distribution hub near Houston. These new assets will make meaningful contributions to the bottom line as booming LNG exports, aggressive data center construction and other catalysts emerge.

OKE has already begun to rally, climbing from $70 in January to $85 today. But this cash-printing business is still trading at just 7 times EBITDA and could revisit the $100 mark as market’s boos turn to cheers.