Diamondback Energy (FANG) Update - April 28

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Simmons Energy Research just set their price target for FANG at $102.

CONCLUSION
In this edition of Simmons Upstream Data Monitor, we take a closer look at the performance
of FANG’s northern Midland Basin assets. 4Q20 production data shows a step-up (+16%
from '19 levels) in well performance, on track to be the strongest quarterly vintage of
the past three years. In Spanish Trail North/County Line and Central Martin County
areas, 2020 vintage Guidon/QEP wells perform on par with or better than FANG wells. In
Robertson Ranch area, while production data is still sparse, most '21 activity will be more
2H21 weighted and is not anticipated to have much production impact in '21. As the two
transactions give FANG more blocky acreage in northern Midland Basin, we believe up-spacing,
increasing completion intensity and longer laterals could drive additional upside in
capital efficiency. Mgmt conservatively sets midpoint of the capital guidance ~8-10% above
current market price. We reiterate our Overweight rating and $102 PT.