Diamondback Energy, Inc. FANG
Diamondback Energy has rallied to $208.55 on the 1M BOE/d production milestone and raised 2026 guidance without lifting the $3.9B capex plan, but the stock now trades at 40.7x trailing earnings — a 249% premium to the peer median of 11.7x — despite EPS collapsing 63% to $5.73 in FY2025 and gross margins compressing from 70.1% in 2022 to 35.2%. Persistent insider selling ($5.18B net over 24 months across 138 dispositions, including August sales by the CEO and CFO) and essentially flat smart money (SM score 0.003 as of Q2 2026, down from 0.057 in Q1) signal that sophisticated investors are not endorsing the rally.
While FCF recovered to $5.24B and the Solitude Pipeline FID is constructive for Permian gas takeaway, the valuation premium is extreme relative to the deteriorating earnings and margin profile.
What could go wrong
- Oil price spike. Sustained higher crude prices could drive margin recovery from the current 35.2% gross margin, partially justifying the elevated multiple.
- Production efficiency upside. Raised 2026 output guidance without lifting the $3.9B capex plan could deliver earnings upside if per-BOE costs decline faster than expected.
- Deleveraging acceleration. With $5.24B in FY2025 FCF against $14.88B total debt, faster-than-expected debt reduction could improve the equity story and support the premium.
- Strategic pipeline value. The Solitude Pipeline FID alongside Devon and MPLX could unlock long-term gas realizations and acreage economics in the Delaware Basin.
What would change my mind
Where this comes from: peer_relative (as of 2026-08-19) · fundamentals FY2025 + derived_metrics FY2025 · derived_metrics FY2022 and FY2025 · insider summary (24-month window). Orin's read on FANG; not advice.
Twelve months actual closes to 2026-09-24 · actual filings
50-day average 200-day average · volume below
On file
All FANG filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Wellington Management Group Llp | $2.9B | 0.5% of fund |
| Vanguard Capital Management | $2.2B | 0.0% of fund |
| State Street | $2.2B | 0.1% of fund |
| Invesco | $2.0B | 0.2% of fund |
| Vanguard Portfolio Management | $1.7B | 0.1% of fund |
| Capital World Investors | $1.6B | 0.2% of fund |
103 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 182 Form 4 filings, net −$7.1B. Of the 50 on hand, 0 were open-market purchases and 43 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about FANG
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Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 36.9× | 8.9× | 51.1× |
| EV/EBITDA | 9.2× | 5.8× | — |
| P/S | 3.11× | 2.89× | — |
| P/B | 1.4× | 1.6× | — |
Its P/E sits above all 5 of the last 5 years (+3.44σ from its own mean).
-1.6%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $5.2B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$232
$205 – $255 · +24% against today's price
- 48 buy or overweight
- 5 hold
- 0 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| FANGDiamondback Energy, Inc. | $53B | 36.9× | 9.2× | 44.5% | 9.3% | 4% |
| EOGEOG Resources, Inc. | $76B | 11.1× | 5.6× | 70.2% | 25.7% | 22% |
| EQTEQT Corporation | $32B | 11.4× | 6.1× | 68.4% | 30.7% | 12% |
| OKEONEOK, Inc. | $57B | 15.7× | 11.4× | 21.8% | 9.3% | 16% |
| OXYOccidental Petroleum Corporation | $58B | 8.7× | 4.9× | 43.4% | 28.8% | 19% |
The median is of the 4 peers listed above and nothing else — check it against the column. This company trades 228.7% above it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $86 | $199.99 · −57% | 2026-06-10 |
| Levered DCF | $321 | $199.99 · +61% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.