Fact based stock research
Diamondback Energy (NasdaqGS:FANG)

US25278X1090

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Diamondback Energy stock research in summary

ir.diamondbackenergy.com

ANALYSIS: With an Obermatt Combined Rank of 80 (better than 80% compared with investment alternatives), Diamondback Energy (Oil & Gas Production, USA) shares have much better financial characteristics than comparable stocks. Shares of Diamondback Energy are low in value (priced high) with a consolidated Value Rank of 44 (worse than 56% of alternatives), and are riskily financed (Safety Rank of 49, which means above-average debt burdens) but show above-average growth (Growth Rank of 94). ...read more

RECOMMENDATION: A Combined Rank of 80, is a strong buy recommendation based on Diamondback Energy's financial characteristics. As the company Diamondback Energy shows low value with an Obermatt Value Rank of 44 (56% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 94% of comparable companies (Obermatt Growth Rank is 94). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 49 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Diamondback Energy, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	44
Growth Rank	94
Safety Rank	49
Combined Rank	80

Country	USA
Industry	Oil & Gas Production
Index	Oil & Gas, SDG 13, SDG 9, Water Efficiency, NASDAQ, S&P 500
Size class	X-Large

This stock has achievements: Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Diamondback Energy

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	24	35	23	44
GROWTH
GROWTH	76	75	57	94
SAFETY
SAFETY	47	57	66	49
SENTIMENT
SENTIMENT	n/a	37	69	^new
360° VIEW
360° VIEW	n/a	49	56	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Diamondback Energy is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	24	35	23	44
GROWTH
GROWTH	76	75	57	94
SAFETY
SAFETY	47	57	66	49
COMBINED
COMBINED	50	57	42	80

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Diamondback Energy the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 44 (worse than 56% compared with alternatives), Diamondback Energy shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators where three out of four are below average for Diamondback Energy. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 82, which means that the stock price is lower compared with invested capital than for 82% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 23 which means the stock price compared with what market professionals expect for future profits is higher than 77% of comparable companies, indicating a low value concerning Diamondback Energy's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 82 and for the dividend yields rank which is lower than for 60% of comparable companies, making the stock more expensive as regards to with the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 44, is a hold recommendation based on Diamondback Energy's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for Diamondback Energy, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	15	8	11	23
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	11	46	46	41
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	24	61	46	82
DIVIDEND YIELD
DIVIDEND YIELD	61	61	54	40
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	24	35	23	44

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Diamondback Energy; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 94 (better than 94% compared with alternatives) for 2024, Diamondback Energy shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all four indicators above average for Diamondback Energy. Sales Growth has a value of 90, which means that, currently, professionals expect the company to grow more than 90% of its competitors. The same is valid for Profit Growth with a value of 71 and for Capital Growth with 88. In addition, Stock Returns had an above-average rank value of 50, which means they have been higher than 50% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 94, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Diamondback Energy exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	82	42	25	90
PROFIT GROWTH
PROFIT GROWTH	26	67	80	71
CAPITAL GROWTH
CAPITAL GROWTH	n/a	82	23	88
STOCK RETURNS
STOCK RETURNS	73	51	93	50
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	76	75	57	94

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Diamondback Energy.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 49 (better than 49% compared with alternatives), the company Diamondback Energy has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Diamondback Energy is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Diamondback Energy. Leverage is at a rank of 51, meaning the company has a below-average debt-to-equity ratio. It has less debt than 51% of its competitors. Liquidity is also good at a rank of 86, meaning the company generates more profit to service its debt than 86% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 22, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 78% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 49 (worse than 51% compared with alternatives), Diamondback Energy has a financing structure that is riskier than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Diamondback Energy. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Diamondback Energy and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	47	61	48	51
REFINANCING
REFINANCING	39	5	56	22
LIQUIDITY
LIQUIDITY	56	89	81	86
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	47	57	66	49

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Diamondback Energy and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	80	76	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	12	49	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	6	39	^new
MARKET PULSE
MARKET PULSE	n/a	50	67	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	37	69	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Diamondback Energy.
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