Diamondback Energy, Inc. (FANG): history, ownership, mission, how it works & makes money

A Brief History of Diamondback Energy, Inc.

Company Overview

Diamondback Energy, Inc. is an independent oil and natural gas company focused on the acquisition, development, exploration, and exploitation of unconventional onshore oil and natural gas reserves primarily in the Permian Basin of West Texas. As of September 30, 2024, Diamondback operates approximately 870,303 net acres, predominantly in the Midland Basin and the Delaware Basin.

Financial Performance

For the nine months ended September 30, 2024, Diamondback reported total revenues of $11.8 billion, a significant increase from $10.77 billion in the same period of 2023. Net income attributable to Diamondback Energy, Inc. for the nine months was $2.02 billion, compared to $3.89 billion for the same period in the previous year.

Recent Acquisitions

On September 10, 2024, Diamondback completed the Endeavor Acquisition, paying approximately $7.3 billion in cash and issuing about 117.27 million shares of common stock. This acquisition included roughly 500,849 gross (361,927 net) acres, mainly in the Permian Basin.

Operational Highlights

During the third quarter of 2024, Diamondback drilled a total of 76 gross horizontal wells and completed 95 gross operated horizontal wells. The company reported an average production of 571,098 BOE/d, with a daily oil production of 321,054 BO/d.

Stock Performance and Share Repurchase Program

As of September 30, 2024, Diamondback's stock repurchase program was authorized for up to $6.0 billion, with $515 million repurchased during Q3. The average price per share for repurchases in Q3 was approximately $176.40.

Dividends

Diamondback paid dividends of $416 million in Q3 2024. The company declared a base cash dividend of $0.90 per share for Q4 2024.

Commodity Prices

Throughout the nine months ended September 30, 2024, WTI prices averaged $77.61 per barrel, while Henry Hub prices averaged $2.22 per MMBtu. These price fluctuations significantly influenced Diamondback's revenue and operational strategies.

Future Outlook

Diamondback anticipates continued growth and expansion opportunities within its operational regions, driven by strategic acquisitions and effective resource management.

A Who Owns Diamondback Energy, Inc. (FANG)

Ownership Structure

As of 2024, following the Endeavor Acquisition completed on September 10, 2024, approximately 39.8% of Diamondback Energy's common stock is held by former Endeavor equityholders. The acquisition involved the issuance of 117.27 million shares of Diamondback common stock, valued at approximately $20.11 billion based on a closing price of $171.49 per share on the transaction date.

Major Institutional Shareholders

The following table summarizes the major institutional shareholders of Diamondback Energy as of 2024:

Executive Ownership

As of 2024, the executive team holds a significant number of shares, with the following key executives and their respective ownership:

Non-controlling Interests

As of September 30, 2024, Diamondback Energy also holds non-controlling interests primarily in Viper Energy, which represents minority ownership. The net income attributable to non-controlling interests for the third quarter of 2024 was $49 million.

Stock Performance and Dividends

Diamondback Energy declared a base cash dividend of $0.90 per share for the third quarter of 2024, totaling $416 million in dividends paid. The company also increased its stock repurchase program authorization to $6.0 billion.

Financial Summary

The financial performance of Diamondback Energy for the third quarter of 2024 included:

Conclusion on Ownership Dynamics

Diamondback Energy's ownership composition reflects a blend of institutional investors, executive ownership, and significant non-controlling interests, particularly from the Endeavor Acquisition, shaping the company's strategic direction and financial stability moving forward.

Diamondback Energy, Inc. (FANG) Mission Statement

Mission Statement Overview

Diamondback Energy, Inc. is committed to being a leading independent oil and natural gas company focused on the acquisition, development, exploration, and exploitation of unconventional, onshore oil and natural gas reserves in the Permian Basin in West Texas. The company aims to deliver strong returns to its shareholders while maintaining a commitment to environmental stewardship and operational excellence.

Financial Performance and Key Metrics

As of September 30, 2024, Diamondback Energy reported significant financial metrics that underscore its operational performance:

Operational Highlights

In the third quarter of 2024, Diamondback Energy achieved notable operational milestones:

• Drilled 71 gross horizontal wells in the Midland Basin.
• Completed 95 gross operated horizontal wells.
• Maintained an average cash operating cost of $11.49 per BOE.
• Executed a stock repurchase program with an authorization increased to $6.0 billion.

Recent Acquisitions

Diamondback's strategic acquisitions have significantly enhanced its asset portfolio:

• Endeavor Acquisition completed on September 10, 2024, for $27.42 billion, including:
• Cash consideration of $7.31 billion.
• 117.27 million shares of common stock valued at approximately $20.11 billion.
• TRP Energy, LLC asset exchange agreement valued at $238 million.

Stockholder Returns

Diamondback Energy continues to prioritize shareholder returns through dividends and stock repurchases:

• Declared a base cash dividend of $0.90 per share payable in Q4 2024.
• Paid dividends totaling $416 million in Q3 2024.
• Repurchased $515 million of common stock during Q3 2024.

Conclusion on Financial Strategy

Diamondback Energy's financial strategy emphasizes robust cash flow management, significant capital investments in growth, and a commitment to returning capital to shareholders. The company aims to optimize its operational efficiency while expanding its footprint in the Permian Basin.

How Diamondback Energy, Inc. (FANG) Works

Company Overview

Diamondback Energy, Inc. is an independent oil and natural gas company focused on the acquisition, development, exploration, and exploitation of unconventional, onshore oil and natural gas reserves primarily in the Permian Basin in West Texas. As of September 30, 2024, the company held approximately 870,303 net acres, with around 715,956 acres in the Midland Basin and 154,026 acres in the Delaware Basin.

Financial Performance

For the third quarter of 2024, Diamondback reported the following financial highlights:

• Net income: $659 million
• Total revenues: $2,645 million
• Basic earnings per share: $3.19
• Diluted earnings per share: $3.19

Production Data

Diamondback's production for the nine months ended September 30, 2024, was as follows:

Operational Highlights

In the third quarter of 2024, Diamondback achieved:

• Average production of 571.1 MBOE/d.
• Drilled 71 gross horizontal wells in the Midland Basin.
• Turned 95 gross operated horizontal wells to production.
• Incurred capital expenditures, excluding acquisitions, of $688 million.

Acquisitions

Diamondback completed the Endeavor Acquisition on September 10, 2024, for a total consideration of approximately $7.3 billion in cash and 117.27 million shares of common stock. This acquisition added approximately 500,849 gross (361,927 net) acres, primarily located in the Permian Basin.

Market Position and Strategy

Diamondback's strategy focuses on low-cost operations and maximizing returns through efficient production. The company reported cash operating costs of $11.49 per BOE, which includes:

• Lease operating expenses: $6.01 per BOE
• General and administrative expenses: $0.63 per BOE
• Production and ad valorem taxes: $4.85 per BOE

Debt and Equity Structure

As of September 30, 2024, Diamondback's total liabilities stood at $26.93 billion, with long-term debt amounting to $11.92 billion.

Dividend Policy

During the third quarter of 2024, Diamondback paid dividends totaling $416 million and declared a base cash dividend of $0.90 per share for the fourth quarter.

How Diamondback Energy, Inc. (FANG) Makes Money

Revenue Streams

Diamondback Energy generates revenue primarily through the sale of oil, natural gas, and natural gas liquids. The breakdown of revenues for the third quarter and nine months ended September 30, 2024, is as follows:

Production Volumes

Diamondback's production for the three months ended September 30, 2024, included:

Operating Costs

For the third quarter of 2024, the operating costs incurred by Diamondback were:

Net Income

The net income attributable to Diamondback Energy for the third quarter of 2024 was:

Dividends and Share Repurchases

During the third quarter of 2024, Diamondback paid dividends and repurchased shares as follows:

Acquisitions and Growth Strategy

In 2024, Diamondback completed significant acquisitions which are pivotal to its growth strategy:

• Endeavor Acquisition: Closed on September 10, 2024, for $7.3 billion in cash and approximately 117.27 million shares of common stock.
• Viper TWR Acquisition: Completed on October 1, 2024, for $459 million in cash and 10.09 million Viper LLC units.

These acquisitions added substantial proved and unproved properties, enhancing Diamondback's operational footprint in the Permian Basin.

Market Position and Future Outlook

As of September 30, 2024, Diamondback's total assets were reported at:

Updated on 16 Nov 2024

Resources:

1. Diamondback Energy, Inc. (FANG) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Diamondback Energy, Inc. (FANG)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Diamondback Energy, Inc. (FANG)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.