Diamondback Energy (FANG) Rises But Trails Market: What Investors Should Know

Diamondback Energy (FANG - Free Report) closed the most recent trading day at $161.01, reflecting a modest increase of 1.58% from the previous session. However, this gain fell short of the broader S&P 500's daily increase of 1.77%. In comparison, the Dow Jones Industrial Average rose by 1.42%, while the tech-heavy Nasdaq achieved a more considerable increase of 2.28%.

In the past month, shares of Diamondback Energy have gained 1.52%, outperforming the Oils-Energy sector which only saw a growth of 0.43%. Notably, the S&P 500 experienced a decline of 5.73% in the same timeframe.

Investors and analysts are keenly awaiting the company’s upcoming earnings announcement, scheduled for May 5, 2025. Expectations are set for an earnings per share (EPS) of $3.73, which represents a decrease of 17.11% compared to the same quarter last year. Concurrently, the latest consensus estimate forecasts revenues of $3.61 billion, marking a sharp increase of 62.19% from the corresponding period in the previous year.

Looking at the annual projections, the Zacks Consensus Estimates predict an EPS of $15.25 and total revenue of $14.92 billion, indicating changes of -7.97% and +34.79%, respectively, when stacked against last year’s figures.

It’s essential for investors to monitor any recent adjustments in analyst estimates for Diamondback Energy, as these alterations frequently signify shifts in short-term business trends. Positive revisions generally reflect confident expectations regarding the company's performance and profitability.

Research indicates a connection between these estimate changes and stock prices in the near term. To help capitalize on this trend, the Zacks Rank system provides an exclusive operational ranking, taking into account these changes in estimates.

The Zacks Rank ranges from #1 (Strong Buy) to #5 (Strong Sell) and has a solid record of outperforming market averages. Historically, stocks rated #1 have shown an average annual return of +25% since 1988. Over the last month, the Zacks Consensus EPS estimate for Diamondback Energy has decreased by 2.68%, resulting in a current Zacks Rank of #3 (Hold).

When assessing valuation, Diamondback Energy is presently trading at a Forward P/E ratio of 10.4, which is higher than the industry average Forward P/E of 8.31.

Additionally, the company has a PEG ratio of 1.25. This figure, similar to the commonly used P/E ratio, incorporates anticipated earnings growth rates, aligning with the Oil and Gas - Exploration and Production - United States sector’s average PEG ratio of 1.25 based on recent closing prices.

The Oil and Gas - Exploration and Production sector is categorized within the Oils-Energy sector. Currently, this sector has a Zacks Industry Rank of 71, placing it in the top 29% of over 250 industries.

The Zacks Industry Rank evaluates industry group strength by determining the average Zacks Rank of individual stocks within those categories. Historically, industries in the top half have outperformed the bottom half by a ratio of 2 to 1.

Investors are encouraged to keep an eye on various influential metrics related to Diamondback Energy as they navigate the forthcoming trading periods.

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