Diamondback Energy, Inc. (FANG), based in Midland, Texas, is an independent oil and natural gas company. With a market capitalization of $46.8 billion, it is heavily involved in acquiring, developing, exploring, and exploiting unconventional onshore oil and natural gas reserves in the Permian Basin of West Texas.
Companies with market caps of $10 billion or more are classified as "large-cap stocks," and FANG fits this category perfectly, reflecting its significant size, influence, and leadership within the oil & gas exploration and production (E&P) industry. The company’s focus on the Permian Basin has driven substantial growth in its proven reserves, which now total 2.2 billion barrels of oil equivalent. This growth underscores Diamondback's effective exploration and development strategies, bolstered by acquisitions such as the Endeavor Acquisition.
However, despite its considerable strengths, FANG's stock has faced some challenges. The stock dropped 27.2% from its 52-week high of $214.50, reached on July 17. Over the past three months, FANG's performance declined by 12.4%, lagging behind the S&P 500 Index, which gained 4.5% during the same period.
Looking at a longer time frame, FANG's stock showed minimal growth year-to-date (YTD) and over the past 52 weeks, underperforming the S&P 500 Index, which gained 23.1% YTD and 23.9% over the last year.
Further confirming the bearish trend, FANG has been trading below its 50-day moving average since early August, with ongoing fluctuations. Additionally, the stock has remained below its 200-day moving average since early September, with some volatility.
On November 4, FANG shares increased by more than 2% following the release of its Q3 results. The company reported an adjusted earnings per share (EPS) of $3.38, missing Wall Street's forecast of $3.80. However, its revenue of $2.6 billion exceeded expectations, which were set at $2.5 billion.
FANG's rival, Occidental Petroleum Corporation (OXY), has faced a tougher market. OXY's stock dropped 22.9% YTD and 22% over the past 52 weeks.
Despite recent setbacks, Wall Street analysts are optimistic about FANG's future. The stock holds a consensus "Strong Buy" rating from 27 analysts, with a mean price target of $216.74, implying a potential upside of 38.9% from its current price level.
On the publication date, Neha Panjwani did not have (either directly or indirectly) any positions in the securities mentioned in this article. All data and information presented here are for informational purposes only. For further details, please refer to the Barchart Disclosure Policy.
