- Output targets are going up again. Diamondback Energy now targets 2026 production of 524,000 barrels of oil a day and total output of 1,015,000 barrels of oil equivalent a day, after lifting guidance twice already this year, according to The Wall Street Journal.
- Profit jumped. Third-quarter profit was $1.6 billion, or $5.69 a share, up from $1.02 billion, or $3.51 a share, a year earlier, an increase of about 57% (Lumida calculation). Adjusted earnings were $5.86 a share, above the $5.72 analysts polled by FactSet expected.
- Revenue beat by a wide margin. Revenue rose to $5.43 billion from $3.92 billion a year earlier, ahead of expectations for $4.6 billion, a year-over-year gain of about 39% (Lumida calculation).
- Oil prices were higher than a year ago. Average realized oil prices were $87.30 a barrel, compared with $64.60 a year earlier but down from $96.82 in the second quarter.
What Happened?
Diamondback reported results on Monday as oil prices remain volatile because of the war in Iran, which has driven the company’s repeated guidance increases this year, according to the WSJ. For the fourth quarter, Diamondback expects to produce between 518,000 and 528,000 barrels of oil a day, and between 1,025,000 and 1,045,000 barrels of oil equivalent a day.
Why It Matters?
Diamondback’s third guidance increase this year shows US oil output is still growing while prices stay elevated. Higher production at strong prices supports cash flow, but the drop in realized prices from the second quarter shows how much results depend on the path of the Iran war. More US supply also matters for the oil market as a whole if prices fall on any peace deal.
What’s Next?
Watch whether Diamondback delivers fourth-quarter output within its 518,000 to 528,000 barrel range and how it sets 2027 plans if oil prices swing sharply on news from Iran. Investors will also watch for updates on capital returns to shareholders from the higher cash flow.
Affected Tickers and Coins: FANG, XLE, USO
Source: WSJ
