We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Diamondback (FANG) Q1 Earnings Miss Estimates on Lower Prices
Read MoreHide Full Article
U.S. energy operator Diamondback Energy (FANG - Free Report) reported first-quarter 2023 adjusted earnings per share of $4.10, missing the Zacks Consensus Estimate of $4.36 and deteriorating from the year-ago bottom line of $5.20 per share. The underperformance reflects lower overall realization, partly offset by higher-than-expected production.
Moreover, revenues of $1.9 billion fell 20% from the year-ago quarter’s sales and lagged the Zacks Consensus Estimate by 1.3%.
In good news for investors, the company is using the excess cash from a supportive environment to reward them with dividends and buybacks. As part of that, FANG’s board of directors declared a quarterly cash dividend of 80 cents per share to its common shareholders of record on May 11. The payout will be made on May 18. In addition to the regular dividend, FANG declared a special dividend of 3 cents per share.
The company also executed $332 million of share repurchases during the first quarter of 2023 at $131.34 apiece.
Diamondback Energy, Inc. Price, Consensus and EPS Surprise
FANG’s production of oil and natural gas averaged 425,022 barrels of oil equivalent per day (BOE/d), comprising 59% oil. The figure was up 11.4% from the year-ago quarter and surpassed the Zacks Consensus Estimate of 421,729 BOE/d. While crude and natural gas output increased 12.8% and 11.1% year over year, respectively, natural gas liquids volumes rose 7.9% from the first quarter of 2022.
The average realized oil price during the most recent quarter was $73.11 per barrel, in line with the consensus mark but 24.7% lower than the year-ago realization of $97.03. Meanwhile, the average realized natural gas price fell to $1.46 per thousand cubic feet (Mcf) from $3.61 in the year-ago period and missed the Zacks Consensus Estimate of $1.57. Overall, the company fetched $49.72 per barrel compared with $69.60 a year ago.
Costs & Financial Position
Diamondback’s first-quarter cash operating cost was $11.61 per barrel of oil equivalent (BOE) compared to $11.36 in the prior-year quarter. Lease operating expense was $5.02 per BOE compared with $4.34 in the first quarter of 2022. FANG’s production taxes decreased 13.6% year over year to $4.05 per BOE. On the other hand, gathering and transportation expenses shot up in the first quarter of 2023 to $1.78 per BOE from $1.72 during the corresponding period of 2022.
Diamondback spent $657 million in capital expenditure — $580 million on drilling and completion, $42 million on infrastructure, environment and $35 million on midstream. The company booked $646 million of free cash flows in the first quarter.
As of Mar 31, the Permian-focused operator had approximately $46 million in cash and cash equivalents, and $7 billion in long-term debt, representing a debt-to-capitalization of 30.1%.
Guidance
In 2023, FANG said it still looks to pump 430,000-440,000 BOE/d of hydrocarbon. Of this, oil volumes are likely to be 256,000-262,000 barrels per day. The company forecast a capital spending budget between $2.5 billion and $2.7 billion.
Zacks Rank & Stock Picks
Diamondback — a Permian Basin-focused upstream oil and gas company — carries a Zacks Rank #3 (Hold) at present.
Meanwhile, investors interested in the energy sector might look at operators like Weatherford International (WFRD - Free Report) , Riley Exploration Permian (REPX - Free Report) and Sunoco LP (SUN - Free Report) . Each of the companies has a Zacks Rank #1 (Strong Buy).
Weatherford International: WFRD beat the Zacks Consensus Estimate for earnings in two of the trailing four quarters. Weatherford International has a trailing four-quarter earnings surprise of 0.5%, on average.
WFRD is valued at around $4.3 billion. Weatherford International has seen its shares inch up 78.9% in a year.
Sunoco LP: SUN beat the Zacks Consensus Estimate for earnings twice in the trailing four quarters. Over the past 30 days, Sunoco saw the Zacks Consensus Estimate for 2023 move up 0.7%.
Sunoco is valued at around $4.6 billion. SUN has seen its shares gain 1% in a year.
Riley Exploration Permian: Riley Exploration Permian beat the Zacks Consensus Estimate for earnings in three of the last four quarters. REPX has a trailing four-quarter earnings surprise of roughly 12.7%, on average.
Riley Exploration Permian is valued at around $814 million. REPX has seen its shares surge 56.2% in a year.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Diamondback (FANG) Q1 Earnings Miss Estimates on Lower Prices
U.S. energy operator Diamondback Energy (FANG - Free Report) reported first-quarter 2023 adjusted earnings per share of $4.10, missing the Zacks Consensus Estimate of $4.36 and deteriorating from the year-ago bottom line of $5.20 per share. The underperformance reflects lower overall realization, partly offset by higher-than-expected production.
Moreover, revenues of $1.9 billion fell 20% from the year-ago quarter’s sales and lagged the Zacks Consensus Estimate by 1.3%.
In good news for investors, the company is using the excess cash from a supportive environment to reward them with dividends and buybacks. As part of that, FANG’s board of directors declared a quarterly cash dividend of 80 cents per share to its common shareholders of record on May 11. The payout will be made on May 18. In addition to the regular dividend, FANG declared a special dividend of 3 cents per share.
The company also executed $332 million of share repurchases during the first quarter of 2023 at $131.34 apiece.
Diamondback Energy, Inc. Price, Consensus and EPS Surprise
Diamondback Energy, Inc. price-consensus-eps-surprise-chart | Diamondback Energy, Inc. Quote
Production & Realized Prices
FANG’s production of oil and natural gas averaged 425,022 barrels of oil equivalent per day (BOE/d), comprising 59% oil. The figure was up 11.4% from the year-ago quarter and surpassed the Zacks Consensus Estimate of 421,729 BOE/d. While crude and natural gas output increased 12.8% and 11.1% year over year, respectively, natural gas liquids volumes rose 7.9% from the first quarter of 2022.
The average realized oil price during the most recent quarter was $73.11 per barrel, in line with the consensus mark but 24.7% lower than the year-ago realization of $97.03. Meanwhile, the average realized natural gas price fell to $1.46 per thousand cubic feet (Mcf) from $3.61 in the year-ago period and missed the Zacks Consensus Estimate of $1.57. Overall, the company fetched $49.72 per barrel compared with $69.60 a year ago.
Costs & Financial Position
Diamondback’s first-quarter cash operating cost was $11.61 per barrel of oil equivalent (BOE) compared to $11.36 in the prior-year quarter. Lease operating expense was $5.02 per BOE compared with $4.34 in the first quarter of 2022. FANG’s production taxes decreased 13.6% year over year to $4.05 per BOE. On the other hand, gathering and transportation expenses shot up in the first quarter of 2023 to $1.78 per BOE from $1.72 during the corresponding period of 2022.
Diamondback spent $657 million in capital expenditure — $580 million on drilling and completion, $42 million on infrastructure, environment and $35 million on midstream. The company booked $646 million of free cash flows in the first quarter.
As of Mar 31, the Permian-focused operator had approximately $46 million in cash and cash equivalents, and $7 billion in long-term debt, representing a debt-to-capitalization of 30.1%.
Guidance
In 2023, FANG said it still looks to pump 430,000-440,000 BOE/d of hydrocarbon. Of this, oil volumes are likely to be 256,000-262,000 barrels per day. The company forecast a capital spending budget between $2.5 billion and $2.7 billion.
Zacks Rank & Stock Picks
Diamondback — a Permian Basin-focused upstream oil and gas company — carries a Zacks Rank #3 (Hold) at present.
Meanwhile, investors interested in the energy sector might look at operators like Weatherford International (WFRD - Free Report) , Riley Exploration Permian (REPX - Free Report) and Sunoco LP (SUN - Free Report) . Each of the companies has a Zacks Rank #1 (Strong Buy).
You can see the complete list of today’s Zacks #1 Rank stocks here.
Weatherford International: WFRD beat the Zacks Consensus Estimate for earnings in two of the trailing four quarters. Weatherford International has a trailing four-quarter earnings surprise of 0.5%, on average.
WFRD is valued at around $4.3 billion. Weatherford International has seen its shares inch up 78.9% in a year.
Sunoco LP: SUN beat the Zacks Consensus Estimate for earnings twice in the trailing four quarters. Over the past 30 days, Sunoco saw the Zacks Consensus Estimate for 2023 move up 0.7%.
Sunoco is valued at around $4.6 billion. SUN has seen its shares gain 1% in a year.
Riley Exploration Permian: Riley Exploration Permian beat the Zacks Consensus Estimate for earnings in three of the last four quarters. REPX has a trailing four-quarter earnings surprise of roughly 12.7%, on average.
Riley Exploration Permian is valued at around $814 million. REPX has seen its shares surge 56.2% in a year.