NasdaqGS:FANG

Stock Analysis Report

Executive Summary

Diamondback Energy, Inc., an independent oil and natural gas company, focuses on the acquisition, development, exploration, and exploitation of unconventional and onshore oil and natural gas reserves in the Permian Basin in West Texas.


Snowflake Analysis

Reasonable growth potential and fair value.


Similar Companies

Share Price & News

How has Diamondback Energy's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: FANG's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-22.1%

FANG

-16.2%

US Oil and Gas

-10.6%

US Market


1 Year Return

-43.2%

FANG

-32.6%

US Oil and Gas

5.2%

US Market

Return vs Industry: FANG underperformed the US Oil and Gas industry which returned -27.5% over the past year.

Return vs Market: FANG underperformed the US Market which returned 10.2% over the past year.


Shareholder returns

FANGIndustryMarket
7 Day-22.1%-16.2%-10.6%
30 Day-23.3%-18.5%-8.5%
90 Day-23.1%-21.1%-4.6%
1 Year-42.9%-43.2%-30.0%-32.6%7.4%5.2%
3 Year-42.0%-42.6%-27.6%-34.4%31.7%23.2%
5 Year-14.0%-14.9%-29.5%-40.3%56.4%39.3%

Price Volatility Vs. Market

How volatile is Diamondback Energy's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Diamondback Energy undervalued compared to its fair value and its price relative to the market?

39.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: FANG ($63.14) is trading below our estimate of fair value ($97.59)

Significantly Below Fair Value: FANG is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: FANG is poor value based on its PE Ratio (43x) compared to the Oil and Gas industry average (9.1x).

PE vs Market: FANG is poor value based on its PE Ratio (43x) compared to the US market (17.1x).


Price to Earnings Growth Ratio

PEG Ratio: FANG is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: FANG is good value based on its PB Ratio (0.8x) compared to the US Oil and Gas industry average (0.8x).


Next Steps

Future Growth

How is Diamondback Energy forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

27.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FANG's forecast earnings growth (27.2% per year) is above the savings rate (1.7%).

Earnings vs Market: FANG's earnings (27.2% per year) are forecast to grow faster than the US market (13.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: FANG's revenue (10% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: FANG's revenue (10% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: FANG's Return on Equity is forecast to be low in 3 years time (11%).


Next Steps

Past Performance

How has Diamondback Energy performed over the past 5 years?

52.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: FANG has a large one-off loss of $841.0M impacting its December 31 2019 financial results.

Growing Profit Margin: FANG's current net profit margins (6.1%) are lower than last year (39.1%).


Past Earnings Growth Analysis

Earnings Trend: FANG's earnings have grown significantly by 52.2% per year over the past 5 years.

Accelerating Growth: FANG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: FANG had negative earnings growth (-71.6%) over the past year, making it difficult to compare to the Oil and Gas industry average (-18.9%).


Return on Equity

High ROE: FANG's Return on Equity (2.1%) is considered low.


Next Steps

Financial Health

How is Diamondback Energy's financial position?


Financial Position Analysis

Short Term Liabilities: FANG's short term assets ($869.0M) do not cover its short term liabilities ($1.3B).

Long Term Liabilities: FANG's short term assets ($869.0M) do not cover its long term liabilities ($7.4B).


Debt to Equity History and Analysis

Debt Level: FANG's debt to equity ratio (35.9%) is considered satisfactory.

Reducing Debt: FANG's debt to equity ratio has increased from 33.9% to 35.9% over the past 5 years.

Debt Coverage: FANG's debt is well covered by operating cash flow (51.1%).

Interest Coverage: FANG's interest payments on its debt are well covered by EBIT (8x coverage).


Balance Sheet

Inventory Level: FANG has a high level of physical assets or inventory.

Debt Coverage by Assets: FANG's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

What is Diamondback Energy's current dividend yield, its reliability and sustainability?

2.52%

Current Dividend Yield


Upcoming Dividend Payment

TodayFeb 28 2020Ex Dividend DateMar 02 2020Dividend Pay DateMar 10 20208 days from Ex DividendBuy in the next 3 days to receive upcoming dividend

Dividend Yield vs Market

Notable Dividend: FANG's dividend (2.38%) is higher than the bottom 25% of dividend payers in the US market (1.53%).

High Dividend: FANG's dividend (2.38%) is low compared to the top 25% of dividend payers in the US market (3.96%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, FANG has been paying a dividend for less than 10 years.

Growing Dividend: FANG's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (63.9%), FANG's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: FANG's dividends in 3 years are forecast to be well covered by earnings (16.6% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.0yrs

Average management tenure


CEO

Travis Stice (57yo)

8.1yrs

Tenure

US$10,549,163

Compensation

Mr. Travis D. Stice has been Chief Executive Officer and Director of Energen Corporation since November 29, 2018. Mr. Stice serves as the Chief Executive Officer and Director of Viper Energy Partners GP LL ...


CEO Compensation Analysis

Compensation vs Market: Travis's total compensation ($USD10.55M) is about average for companies of similar size in the US market ($USD10.78M).

Compensation vs Earnings: Travis's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Travis Stice
CEO & Director8.1yrsUS$10.55m0.24% $22.2m
Teresa Dick
Chief Accounting Officer0.9yrsUS$3.08m0.021% $1.9m
Russell Pantermuehl
Executive VP & Chief Engineer3.1yrsUS$5.17m0.056% $5.2m
Kaes Van't Hof
CFO & Executive VP of Business Development0.9yrsno data0.010% $939.6k
Daniel Wesson
Senior Vice President of Operations0.4yrsno datano data
Adam Lawlis
Vice President of Investor Relations0yrsno datano data
P. Zmigrosky
Executive VP1yrsno data0.0011% $101.7k
Jennifer Soliman
Executive VP & Chief Human Resources Officer2.1yrsno data0.00052% $49.0k
Thomas Hawkins
Executive Vice President of Land2.9yrsno data0.0060% $563.9k
David Cannon
Senior Vice President of Geoscience and Technology0.9yrsno datano data

1.0yrs

Average Tenure

49yo

Average Age

Experienced Management: FANG's management team is not considered experienced ( 1 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Travis Stice
CEO & Director8.1yrsUS$10.55m0.24% $22.2m
David Houston
Lead Director0yrsUS$275.02k0.0060% $563.9k
Michael Cross
Independent Director7.3yrsUS$275.02k0.0095% $889.7k
Steven West
Independent Chairman of the Board7.3yrsUS$380.02k0.0056% $526.3k
Mark Plaumann
Independent Director7.3yrsUS$275.02kno data
Melanie Trent
Independent Director1.8yrsUS$243.77k0.00099% $93.2k

7.3yrs

Average Tenure

61yo

Average Age

Experienced Board: FANG's board of directors are considered experienced (7.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been substantially diluted in the past year, with total shares outstanding growing by 56.3%.


Top Shareholders

Company Information

Diamondback Energy, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Diamondback Energy, Inc.
  • Ticker: FANG
  • Exchange: NasdaqGS
  • Founded: 2007
  • Industry: Oil and Gas Exploration and Production
  • Sector: Energy
  • Market Cap: US$9.415b
  • Shares outstanding: 158.28m
  • Website: https://www.diamondbackenergy.com

Number of Employees


Location

  • Diamondback Energy, Inc.
  • 500 West Texas Avenue
  • Suite 1200
  • Midland
  • Texas
  • 79701
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FANGNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDOct 2012
7DBDB (Deutsche Boerse AG)YesCommon StockDEEUROct 2012
FANG *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNOct 2012
F1AN34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 SHS UNSPONBRBRLJan 2020

Biography

Diamondback Energy, Inc., an independent oil and natural gas company, focuses on the acquisition, development, exploration, and exploitation of unconventional and onshore oil and natural gas reserves in the Permian Basin in West Texas. It primarily focuses on the development of the Spraberry and Wolfcamp formations of the Midland basin; and the Wolfcamp and Bone Spring formations of the Delaware basin, which are part of the Permian Basin in West Texas and New Mexico. As of December 31, 2018, the company’s net acreage position was approximately 461,218 acres in the Permian Basin; and estimated proved oil and natural gas reserves were 992,001 thousand barrels of crude oil equivalent. It also held working interests in 7,279 gross producing wells, as well as royalty interests in 2,645 additional wells. In addition, the company, through its subsidiary, Viper Energy Partners LP, owns mineral interests in approximately 532,295 gross acres and 14,841 net royalty acres in the Permian Basin and Eagle Ford Shale. Diamondback Energy, Inc. was founded in 2007 and is headquartered in Midland, Texas. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/28 01:45
End of Day Share Price2020/02/27 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.