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Investing.com - KeyBanc has reiterated its Overweight rating and $176.00 price target on Diamondback Energy (NASDAQ:FANG) following the company’s recent asset transactions. Currently trading at $137.28, InvestingPro analysis suggests the stock is undervalued, with a Strong financial health rating.
The firm noted that Diamondback Energy announced both a sale and a drop-down of midstream assets last week, completing its planned deleveraging program that followed the Endeavor and Double Eagle acquisitions. The $39.74B market cap company maintains a 2.91% dividend yield and has generated $9.74B in EBITDA over the last twelve months.
KeyBanc has adjusted its financial model to account for these transactions, which it expects will have a modest impact on Diamondback’s financials, including a slight decline in EPS and EBITDA post-closings, driven by slightly higher operating expenses and lower capital expenditures.
The firm highlighted that these transactions will result in lower leverage for Diamondback Energy and create higher capacity for share repurchases after the deals close.
KeyBanc anticipates that Diamondback Energy will provide preliminary 2026 guidance during its third-quarter earnings report, which would offer more clarity on the company’s financial outlook following these asset transactions. The company’s next earnings report is scheduled for November 10, 2025.
In other recent news, Diamondback Energy has made several notable announcements and received various analyst ratings. The company raised its third-quarter 2025 production guidance following the completion of its subsidiary Viper Energy’s acquisition of Sitio Royalties Corp. This adjustment accounts for contributions from the Sitio assets starting August 19. Meanwhile, Raymond James maintained a Strong Buy rating on Diamondback Energy, though it lowered the price target to $212.00 after the company’s second-quarter earnings report, noting a 2% increase in fiscal year 2025 production guidance and a 3% reduction in the annual capital expenditure budget.
Additionally, William Blair initiated coverage on Diamondback Energy with an Outperform rating, citing the company’s efficient cost structure and high free cash flow per barrel of oil equivalent. Piper Sandler reiterated an Overweight rating with a $222.00 price target, highlighting Diamondback’s operational consistency and increased three-mile lateral completions. Melius Research also initiated coverage with a Buy rating and set a price target of $213.00, emphasizing Diamondback’s operations in the Permian Basin. These developments reflect a period of strategic adjustments and positive analyst sentiment for Diamondback Energy.
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