Diamondback Energy, Inc. (NASDAQ:FANG) is included among the 13 Best Defensive Dividend Stocks for 2025.
On March 5, Benchmark downgraded Diamondback Energy, Inc. (NASDAQ:FANG) to Hold from Buy. The firm did not assign a price target, citing valuation concerns. The analyst noted that the shares have lagged the XLE and XOP year to date. Fourth-quarter results were described as “unremarkable,” and the firm said it sees limited upside from current levels.
In a CNBC report published earlier in February, Sean Russo of Ritholtz Wealth Management pointed to Diamondback Energy’s investor presentation. According to the presentation, FANG has committed to returning at least 50% of quarterly free cash flow to shareholders. Through the third quarter, the company returned $892 million through dividends and share buybacks, which represented exactly 50% of free cash flow.
The company has grown its payout by 7.2% annually since introducing its first dividend in 2018. It currently pays a 2.42% annual dividend and has an $8 billion share buyback authorization in place. Slightly less than half of that authorization remains available to deploy. FANG has repurchased 36.1 million shares since the third quarter of 2021. That amounts to about 20% of its starting float during that period. The company also keeps operating costs low. Management says its “best-in-class cost structure” allows it to remain profitable even when oil prices decline.
Diamondback Energy, Inc. (NASDAQ:FANG) is an independent oil and natural gas company focused on the acquisition, development, exploration, and production of unconventional onshore oil and natural gas reserves. Its operations are concentrated primarily in the Permian Basin in West Texas.
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