Diamondback Energy, Inc. (FANG), headquartered in Midland, Texas, operates in the energy sector with a market cap of $35.3 billion. It is an independent oil and gas exploration and production company primarily focused on the Permian Basin, which spans western Texas and southeastern New Mexico.
Companies worth $10 billion or more are generally described as "large-cap stocks," and Diamondback Energy fits right into that category with its market cap exceeding this threshold, reflecting its substantial size and influence in the energy sector. FANG holds a competitive edge in the upstream oil and gas industry thanks to its prime holdings in the Permian Basin, the most cost-effective source of crude oil in the United States.
The leading energy company’s shares slipped 7.1% below their 52-week high of $211.96, which they touched on April 12. FANG stock has gained 1.4% over the past three months, outperforming the S&P 500 Energy Sector SPDR’s (XLE) 2.1% decline during the same time frame.
In the long run, shares of Diamondback Energy show strong potential. FANG stock has climbed 27% on a YTD basis and 54.8% over the past 52 weeks, significantly outpacing XLE’s 8.1% gain in 2024 and 15% increase over the past year.
To confirm the bullish trend, FANG has been consistently trading above the 200-day moving average and over the 100-day moving average since mid-February, despite some recent fluctuations.
Oil and gas producer Diamondback Energy has thrived amid higher oil prices this year. Additionally, its pending acquisition of Endeavor Energy Resources, L.P. is expected to close in the fourth quarter of 2024. This highly accretive deal will position Diamondback Energy as the leading pure-play producer in the prolific Permian Basin. The company has extended its streak of dividend increases to five consecutive years, further bolstering its appeal.
Despite reporting better-than-expected Q1 adjusted EPS of $4.50 and total revenue of $2.2 billion, the stock dropped 2.3% following the earnings release on April 30 due to missing production estimates. The company's average production reached 461,100 barrels of oil equivalent per day, slightly below Wall Street's expectation of 462,400 barrels of oil equivalent per day, as reported by FactSet.
Meanwhile, Diamondback Energy’s rival, EOG Resources, Inc. (EOG), is significantly underperforming FANG. EOG stock gained 3% in 2024 and 13.3% over the past 52 weeks, lagging behind FANG’s solid returns.
Further, aligning with its impressive price momentum, analysts are bullish on FANG’s prospects. Among the 25 analysts covering the stock, there is a consensus rating of “Strong Buy.” The mean target of $216.76 indicates a potential upswing of 10.1% to the current market prices.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
