Entering text into the input field will update the search result below

Diamondback Energy: Reliability At A Great Price


  • The company has a reliable portfolio of assets that it's using to maintain its strong production.
  • At current prices, we expect the company to be able to provide a double-digit dividend yield, with additional shareholder returns.
  • The company's debt load is more than manageable, and the company has numerous other avenues to increase its cash flow further.
  • Looking for higher risk/reward options trading ideas? I offer this and much more at my exclusive investing ideas service, The Energy Forum. Learn More »

Coiled snake on the ground

RussieseO/iStock via Getty Images

Diamondback Energy, Inc. (NASDAQ:FANG) is a mid-size oil producer that like most other shale companies had a difficult past month, with a more than 20% decline. The company's current market cap is just over $21 billion. However, the company has

Create a High-Yield Portfolio Using Unique Investment Strategies, 2-Week Trial!

The Energy Forum helps you invest in energy, generating strong income and returns from a volatile sector. Our included Income Portfolio helps you invest in the broader market, finding high-yield non sector-specific opportunities.

Recommendations from a top 0.5% author on TipRanks!

Worldwide energy demand is growing and you can be a part of this profitable trend. Plenty of unique under the radar opportunities remain.

Image result for high yield oil

We provide:

  • Model energy and market portfolios generating high-yield income.
  • Deep-dive actionable research. 
  • Macroeconomic overviews.
  • Summaries of recommendations and option strategies.  

Click for our 2-week trial, with 47% off!

This article was written by

The Value Portfolio profile picture

The Value Portfolio specializes in building retirement portfolios and utilizes a fact-based research strategy to identify investments. This includes extensive readings of 10Ks, analyst commentary, market reports, and investor presentations. He invests real money in the stocks he recommends.

He is the leader of the investing group The Retirement Forum with features including: model portfolios, macro overviews, in-depth company analysis and retirement planning information. Learn more.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of FANG either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (19)

galicianova profile picture
How should one balance between Vnom and Fang??
"At current share prices, Diamondback Energy has the ability to drive incredibly strong shareholder returns."

I'm not sure what the share price of the stock has to do with its ability to drive returns. Perhaps you meant at current oil prices??
I have seen a lot of Diamondbacks. The picture is an ugly one. Never seen a black/gray diamondback. I hate snakes but love FANG.
@R Phillips That is not even a Western Diamondback, they are usually far lighter than that and it has an oddly shaped head.
Status of the Rattler acquisition?
@mr2901 The FANG/RTLR acquisition will close sometime this quarter (Q3). So, we holders should get the FANG dividend going forward.
63C-Vette profile picture
@nyc3053 Australia Not sure I follow about the dividend for FANG. Was the $2.35 paid out recently a one time special dividend on top of the $.70? Or is $3.05 expected to be paid out quarterly going forward? Dividend.com shows an August divi of $.75 and then an estimated $.863 per quarter going forward from Nov/22 through 2023. No variable dividend mentioned.
Are we to expect a base dividend plus a variable dividend every quarter?
@63C-Vette What management has said is that from now on, they will return to shareholders at least 75% of free cash flow. The base dividend is just that, the variable dividend is just that, it all depends on earnings. The at least 75% will consist of the base dividend (which will likely grow over time), a variable dividend (which will vary) and share buybacks, which will be done opportunistically. We quite likely will get some sort of a variable dividend most quarters as long as earnings hold up. The base is 'sacrosanct' so to speak, the variable is not.
Except Diamondback isn't a midstream company, as noted by the author.
@O&GInvestor I'm guessing he meant mid-cap but I could be wrong.
Agree, it’s a great company.
Timing however is bad now.
I would sell now and wait until Biden’s recession is in full swing to buy back at much cheaper price.
Around November may be a good entry point from today’s point of view.
@Tom Frosch I tend to agree with you, on FANG in particular and energy in general, later this summer or into the autumn will provide solid opportunities here. We are already getting hints of what may be to come. People are starting to sell winners to compensate for some losers. The contagion is spreading, the VIX is still very subdued surprisingly, but that could flip at a moment's notice. That will likely be as good a time as any to jump in.
@nyc3053 Australia "later this summer or into the autumn will provide solid opportunities here."

If you're not using it for a couple of days could I borrow that crystal ball of yours? There's some other stocks I want to buy and I'd like to know whether they'll be cheaper this fall :)
@chipb We'll have to see just how 'clear' that crystal is. My premise is that we may be at that point after Q2 earnings season where the market is not quite looking far enough ahead as much as it is looking down at its feet. August and September are not normally great months for the market. Time will tell whether I'm right or not. This is a very tough market to read just now, I'll admit that, but we will not go straight up IMO.
Old Professor profile picture
Diamond Energy is also quite "shareholder friendly."
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.