Diamondback Energy, Inc. (FANG)

FairStock Score: 48/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I approach Diamondback as a cyclical Permian oil and gas operator, not a stable consumer franchise. The latest filed quarter, fiscal Q2 2026 ended 2026-06-30, showed revenue of $5.6B, net income of $1.9B, and diluted EPS of $6.65, far above fiscal Q2 2025's $3.7B revenue, $699.0M net income, and $2.38 EPS. But the path is uneven: fiscal Q1 2026 had $4.2B revenue but only $25.0M net income and $0.08 EPS, while FY2025 revenue was $15.0B with net income $1.7B, down from FY2024's $3.3B. That is the cycle at work. The balance sheet looks reasonable with D/E 0.29 and Piotroski 8/9, and trailing free cash flow of $3.7B gives a 6.3% FCF yield. Still, FairStock's returns are weak—ROE 3.49% and ROCE 1.31%—and Altman Z 1.58 is not comforting. At the 2026-10-26 close of $207.13, FairStock P/E is 39.45, P/B 1.53, and Graham Number $126.32, implying a -62.88% margin of safety, so price sits well above that conservative value anchor. The Lynch category is CYCLICAL—Oil & Gas E&P: earnings follow the economic cycle. I see commodity leverage, not a durable moat. Cheap-looking PEG 0.23 and 9.46 EV/EBITDA must be weighed against cyclicality and low returns. I would want a wider margin of safety before calling this a Graham-style bargain.

In plain English: Diamondback Energy is an oil and gas producer focused on the Permian Basin. The business shows strong recent quarterly profit and cash generation, but earnings are uneven because oil and gas prices swing, and the stock looks expensive compared with its earnings and asset value. Its debt load appears manageable.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer