Diamondback Q2 Results Top Estimates; Street Says Buy

Oil and natural gas company Diamondback Energy, Inc. (FANG) has reported better-than-expected results for the second quarter ended June 30, 2021. The company’s robust results were driven by the growth it witnessed in revenues.

Following the earnings, shares of the company appreciated marginally to close at $77 in the extended trading session.

Reported quarterly revenues stood at $1.68 billion, up from last year’s $425 million, surpassing the Street’s estimate of $1.32 billion. This growth can be attributed primarily to the rise in oil, natural gas and natural gas liquid revenues, which rose almost 305% from last year.

Earnings per share (EPS) of $2.40 grew substantially from the previous year’s figure of $0.15. Further, it topped the consensus estimate of $2.12.

Notably, the company expects third-quarter capital expenditure to be in the range of $430-$480 million.

The CEO of Diamondback, Travis Stice, said, “Diamondback built on its track record of execution in the second quarter, generating $578 million of Free Cash Flow. Operationally, capital efficiency continues to improve. As a result, we are cutting our 2021 capital budget by $100 million due to cost control and volume outperformance. Put simply, we are doing more with less: producing more barrels with less capital, fewer completed wells and fewer drilling rigs.” (See Diamondback stock chart on TipRanks)

Recently, Susquehanna analyst Biju Perincheril reiterated a Buy rating on the stock. The analyst, however, raised the price target from $100 to $103, which implies upside potential of 34.2% from current levels.

Consensus among analysts is a Strong Buy based on 16 Buys and 1 Hold. The average Diamondback price target of $11.76 implies 45.6% upside potential from current levels.

Diamondback scores a 7 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock is likely to perform in line with the market expectations. Shares have gained 91.8% over the past year.

Related News:
Linde Delivers Record Q2 Results; Shares Pop 3%
Chevron’s Q2 Results Beat Analysts’ Expectations
Procter & Gamble Tops Consensus Estimates in Q4