Diamondback tops Q3 profit estimates and raises 2026 forecast
Adjusted EPS of $5.86 beat the $5.57 consensus estimate compiled by Finnhub, and revenue of $5.43 billion beat the $4.74 billion estimate. It also raised its annual base dividend 7.3% to $4.72 per share.
Key takeaways
- Diamondback Energy (FANG) reported third-quarter 2026 adjusted earnings of $5.86 per share and revenue of $5.43 billion, both beating consensus estimates. The company raised its 2026 oil production forecast to about 524,000 barrels per day and lifted its annual base dividend 7.3% to $4.72 per share.
Diamondback Energy (FANG) said on Nov. 2 that its adjusted earnings for the third quarter of 2026 topped estimates, and that it raised its full-year production and spending guidance. The independent oil and natural gas company, based in Midland, Texas, focuses on the Permian Basin in West Texas.
Shares were little changed in after-hours trading as of 5:18 p.m. ET, from a regular-session close of $199.29.
Adjusted earnings were $5.86 per diluted share, above the $5.57 consensus estimate. Revenue reached $5.43 billion, above the $4.74 billion estimate, and rose from $3.92 billion a year earlier.
Here's how the company did:
- Adjusted EPS: $5.86 vs. $5.57 consensus estimate
- Diluted EPS, GAAP: $5.69 vs. $3.51 a year earlier
- Total revenue: $5.43 billion vs. $3.92 billion a year earlier
- Net income attributable to Diamondback: $1.60 billion vs. $1.02 billion a year earlier
- Average oil production: 525 thousand barrels per day, or 1,034 thousand barrels of oil equivalent per day
The company generated $2.6 billion of net cash from operating activities in the quarter. Free cash flow was $2.1 billion, and adjusted free cash flow was $2.2 billion. Cash capital expenditures were $1.0 billion.
2026 guidance
Diamondback raised its full-year 2026 oil production forecast to about 524 thousand barrels per day, from more than 522 thousand. Its total production forecast rose to about 1,015 thousand barrels of oil equivalent per day, from more than 1,000 thousand.
Full-year cash capital spending is now expected at $3.95 billion to $4.00 billion, up from about $3.9 billion.
For the fourth quarter, the company expects oil production of 518 to 528 thousand barrels per day and cash capital spending of $1.00 billion to $1.05 billion.
Chief Executive Officer Kaes Van't Hof said in a letter to stockholders that the company's recent small deals are "little wins that add up year in and year out."
Dividend and buybacks
The board approved a 7.3% increase in the base cash dividend, to $1.18 per share for the third quarter. The dividend is payable Nov. 19 to holders of record at the close of business on Nov. 12.
On an annual basis, the base dividend rises to $4.72 per share, from $4.40 previously. The company said the increase marks an 18% rise from a year earlier.
Diamondback repurchased 1,348,209 shares in the third quarter for about $251 million, at a weighted average price of $185.94 per share. It has repurchased 389,841 more shares for about $73 million so far in the fourth quarter.
The company also bought back $106 million in aggregate principal amount of its 2054 and 2064 senior notes, at a weighted average price of 94.9% of par.
Costs and operations
The company drilled 105 wells and completed 135 in the quarter. Average completed lateral length was 13,584 feet.
Lease operating expense was $5.97 per barrel of oil equivalent, and total cash operating expense was $10.91, up from $10.05 a year earlier.
The company recorded no impairment of oil and natural gas properties in the quarter, after a $1.40 billion impairment for the first nine months of 2026.
At Sept. 30, consolidated total debt was $13.38 billion and consolidated net debt was $12.82 billion.