Northland Securities Sticks to Their Buy Rating for Diamondback (FANG)

By Jason Carr

In a report released today, Jeff Grampp from Northland Securities reiterated a Buy rating on Diamondback (FANGResearch Report), with a price target of $160. The company’s shares closed yesterday at $104.12.

Grampp commented:

“We are increasing our PT on FANG from $150 to $160 and reiterating our Outperform rating following the successful IPO of RTLR in May ( Link to RTLR Initiation ). With the IPO, FANG was able to generate $721MM in net proceeds while retaining an equity stake in RTLR currently worth $2.1 billion (Based on yesterday’s closing price). We view the transaction as a positive valuation marker for its midstream assets and believe FANG shares are cheap on a sum-of-parts basis.”

According to TipRanks.com, Grampp is currently ranked with no stars on a 0-5 star ranking scale, with an average return of -13.3% and a 22.8% success rate. Grampp covers the Basic Materials sector, focusing on stocks such as Penn Virginia Corporation, Sundance Energy Australia, and SilverBow Resources Inc.

Diamondback has an analyst consensus of Strong Buy, with a price target consensus of $153.22, implying a 47.2% upside from current levels. In a report issued on June 7, Roth Capital also maintained a Buy rating on the stock with a $150 price target.

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Based on Diamondback’s latest earnings release for the quarter ending March 31, the company reported a quarterly revenue of $864 million and net profit of $10 million. In comparison, last year the company had a net profit of $163 million.

Based on the recent corporate insider activity of 54 insiders, corporate insider sentiment is negative on the stock.

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Diamondback Energy, Inc. is independent oil and natural gas company. The firm engages in the acquisition, development, exploration, and exploitation of unconventional, onshore oil, and natural gas reserves. It focuses on the Permian Basin. The company was founded in December 2007 and is headquartered in Midland, TX.