Diamondback Energy (FANG) Update - Jan 24

[dan_s]

Piper Sandler Cuts Price Target on Diamondback Energy to $201 From $206, Maintains Overweight Rating
09:57 AM EST, 01/24/2024 (MT Newswires) -- Diamondback Energy (FANG) has an average outperform rating and price target range of $129 to $240, according to analysts polled by Capital IQ.

FANG was trading at $153.28 at the time of this post.

I have updated my forecast/valuation model for FANG and it will be available on the EPG website this afternoon.

I have decided to move FANG back to the Sweet 16 Growth Portfolio from the High Yield Income Portfolio to replace CPE, which is being acquired by APA. I was considering APA for the Sweet 16, but I need to spend a lot of time on APA and I'm not keen on upstream companies that have a lot of core areas outside of North America.

I do expect FANG to pay some very nice "Regular + Variable Dividends" in 2024; over $3/quarter per my forecast.

TipRanks: "In the last 3 months, 15 ranked analysts set 12-month price targets for FANG. The average price target among the analysts is $183.75. The 15 price targets range from $147 to $240."

[Hawker99]

Raymond James was out today on APA and they had this to say in summation:

RECOMMENDATION
APA possesses one of the best 2024 FCF yields, substantial commodity exposure (unhedged on oil), and significant resource potential in Suriname.
With at least ~60% of yearly FCF going to shareholders, APA also boasts a strong shareholder return framework.
Additionally, APA trades below competitors on an EV/EBITDA basis, at just ~3.1x 2024E versus the peer average of ~5.4x.
As such, we reiterate our Strong Buy rating, but decrease our price target to $43/share (from $44/share)

[dan_s]

Today I own some CPE and I will hang on and take shares in APA. I just don't have time this month to take a hard look at the Company and I like to follow a stock for over a year before I add it to the Sweet 16.

The merger of CPE into APA is a tax free exchange.

I finally had to buy a new desktop computer and the transition is taking up a lot of time this week. Lots of files and software to move to the new computer. I hope to make the "Leap of Faith" on Saturday.