Core Viewpoint - Viper Energy, Inc. has announced a definitive agreement to acquire Sitio Royalties Corp. in an all-equity transaction valued at approximately $4.1 billion, which includes Sitio's net debt of about $1.1 billion as of March 31, 2025 [1] Transaction Details - The acquisition will involve the exchange of 0.4855 shares of Class A common stock of a new holding company for each share of Sitio Class A common stock, and 0.4855 units of Viper's operating subsidiary for each unit of Sitio's operating subsidiary, implying a value of $19.41 per Sitio share based on Viper's stock price on June 2, 2025 [1] - The transaction has received unanimous approval from the Boards of Directors of both companies and has the consent of Diamondback Energy, Viper's majority stockholder [1] - Approximately 48% of Sitio's voting power has agreed to support the transaction [1] - The deal is subject to customary regulatory approvals and is expected to close in Q3 2025 [1] Financial Highlights - Viper has approved a 10% increase in its base dividend to $1.32 per share annually, which represents approximately 45% of cash available for distribution at $50 WTI [2][6] - The acquisition is expected to be approximately 8-10% accretive to cash available for distribution per Class A share immediately upon closing [6] - The pro forma Viper's base dividend breakeven is expected to decrease by approximately $2 per barrel to below $20 WTI [6] - Estimated annual synergies from the merger are projected to exceed $50 million, primarily from administrative and capital cost savings [6] Strategic Rationale - The merger is expected to create a leader in the minerals industry with enhanced size, scale, liquidity, and access to investment-grade capital [7] - The combined company will have approximately 34,300 net royalty acres in the Permian Basin and an additional ~9,000 net royalty acres in other major basins [6][7] - The merger will position the combined entity to compete effectively for capital with mid and large-cap North American exploration and production companies, benefiting from higher margins and lower operating costs [7] Production and Operational Highlights - The average production for Q1 2025 was reported at 18.9 mbo/d (42.1 mboe/d), with Permian production at 14.5 mbo/d (31.9 mboe/d) [6] - The pro forma Viper is expected to have an average production of 64-68 mbo/d (122-130 mboe/d) by Q4 2025, with a mid-single-digit percentage increase expected for the full year 2026 [6]

Core Viewpoint - Major U.S. companies' earnings and tariff uncertainties are affecting investor sentiment, leading to a focus on attractive dividend stocks for consistent returns [1][2] Group 1: Home Depot (HD) - Home Depot reported mixed Q1 FY2025 results but reaffirmed its full-year guidance, maintaining prices despite tariffs [3][4] - The company declared a dividend of $2.30 per share for Q1 2025, resulting in an annualized dividend of $9.20 per share and a yield of 2.5% [3] - Analyst Greg Melich from Evercore reiterated a buy rating with a price target of $400, highlighting stabilizing traffic and improved online sales growth [4][5] - Melich believes Home Depot could become a significant breakout stock once the macro environment improves, similar to Costco and Walmart [6] Group 2: Diamondback Energy (FANG) - Diamondback Energy delivered better-than-expected Q1 results but reduced its full-year activity to maximize free cash flow due to commodity price volatility [8] - The company returned $864 million to shareholders in Q1 2025 through stock repurchases and a base dividend of $1.00 per share, resulting in a yield of nearly 3.9% [9] - Analyst Scott Hanold from RBC Capital reaffirmed a buy rating with a price target of $180, noting a 10% reduction in the capital budget but only a 1% cut in production outlook [10][11] - Hanold expects Diamondback to exceed its 50% minimum shareholder return target and plans to use remaining free cash flow to pay down a $1.5 billion term loan [12][13] Group 3: ConocoPhillips (COP) - ConocoPhillips reported market-beating Q1 2025 earnings but reduced its full-year capital and adjusted operating cost guidance while maintaining production outlook [14] - The company distributed $2.5 billion to shareholders in Q1 2025, including $1.5 billion in share repurchases and $1.0 billion in ordinary dividends, resulting in a yield of about 3.7% [15] - Analyst Neil Mehta from Goldman Sachs reiterated a buy rating with a price target of $119, highlighting uncertainty in oil prices but optimism about long-term gas prices [16][18] - Mehta expects COP's breakeven to decrease, projecting it to head towards the low $30s as LNG spending decreases and production from the Willow project begins in 2029 [17]

Group 1: Oil Market Overview - Oil prices have been volatile, influenced by geopolitical tensions and bearish crude data from the U.S. West Texas Intermediate (WTI) crude is down 0.7% at $61.62, contributing to a 14.3% year-to-date deficit [1] - The market is reacting to reports of Israel preparing to strike Iran, which has added to the volatility [1] Group 2: Company Performance - EQT Corp (NYSE:EQT) reached an 11-year high of $57.37, currently down 0.3% at $55.96, with a year-over-year increase of 35.7% and a year-to-date increase of 21.5% [2] - TotalEnergies SE (NYSE:TTE) is down 0.3% at $59.21, facing resistance at the $60 level and its 160-day moving average, but is still up 8.7% year-to-date [3] - Diamondback Energy Inc (NASDAQ:FANG) hit a two-year low of $114.00, currently down 0.8% at $137.22, and has decreased 16.2% year-to-date [4]

U.S. energy operator Diamondback Energy (FANG) reported first-quarter 2025 adjusted earnings per share of $4.54, which beat the Zacks Consensus Estimate of $4.09 and came ahead of the year-ago bottom line of $4.50.The outperformance reflects strong production and lower costs, which more than offset a fall in oil realization.Meanwhile, revenues of $4 billion jumped 82% from the year-ago quarter’s sales and outperformed the Zacks Consensus Estimate by 8.1%.(See the Zacks Earnings Calendar to stay ahead of mar ...

[PART I. FINANCIAL INFORMATION](index=9&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) Part I provides the unaudited condensed consolidated financial statements and management's discussion and analysis for the quarter ended March 31, 2025 [Condensed Consolidated Financial Statements (Unaudited)](index=9&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) The unaudited Q1 2025 financial statements reflect significant growth driven by the Endeavor acquisition, with increased assets, revenues, and net income [Condensed Consolidated Balance Sheets](index=10&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet as of March 31, 2025, shows total assets of **$70.07 billion**, reflecting growth in cash and equity Condensed Consolidated Balance Sheet Highlights (in millions) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $1,816 | $161 | | Property and equipment, net | $64,896 | $64,472 | | Total assets | $70,066 | $67,292 | | **Liabilities & Equity** | | | | Total current liabilities | $4,753 | $4,811 | | Long-term debt | $12,996 | $12,075 | | Total liabilities | $28,323 | $27,430 | | Total equity | $41,743 | $39,862 | [Condensed Consolidated Statements of Operations](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Q1 2025 operations show total revenues of **$4.05 billion** and net income of **$1.41 billion**, significantly up year-over-year due to acquisitions Q1 2025 vs. Q1 2024 Statement of Operations (in millions, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenues | $4,048 | $2,227 | | Income from operations | $1,673 | $1,118 | | Gain (loss) on derivative instruments, net | $226 | $(48) | | Net income (loss) attributable to Diamondback | $1,405 | $768 | | Diluted Earnings (loss) per common share | $4.83 | $4.28 | [Condensed Consolidated Statements of Cash Flows](index=16&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 cash flows show strong operating cash generation of **$2.36 billion**, with increased investing and financing activities Q1 2025 vs. Q1 2024 Cash Flows (in millions) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $2,355 | $1,334 | | Net cash used in investing activities | $(1,653) | $(751) | | Net cash provided by (used in) financing activities | $1,175 | $(269) | | Net increase in cash and cash equivalents | $1,877 | $314 | [Notes to the Condensed Consolidated Financial Statements](index=17&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Notes detail significant corporate events, including the Endeavor acquisition, subsequent Double Eagle acquisition, and Viper asset drop-down - The company is an independent oil and natural gas company focused on the acquisition, development, exploration, and exploitation of unconventional, onshore oil and natural gas reserves primarily in the Permian Basin in West Texas[31](index=31&type=chunk) - Diamondback continues to consolidate its subsidiary Viper Energy, Inc., determining it to be a Variable Interest Entity (VIE) of which Diamondback is the primary beneficiary, despite ownership falling below **50%**[34](index=34&type=chunk)[43](index=43&type=chunk) - On September 10, 2024, the Company completed its acquisition of Endeavor for total consideration of **$27.42 billion**, consisting of **$7.31 billion** in cash and **117.27 million** shares of common stock. This acquisition added **$1.4 billion** in revenue and **$477 million** in net income for Q1 2025[69](index=69&type=chunk)[73](index=73&type=chunk)[76](index=76&type=chunk) - Subsequent to quarter end, on April 1, 2025, the company completed the acquisition of Double Eagle for **$3.0 billion** in cash and **~6.84 million** shares[156](index=156&type=chunk) - Subsequent to quarter end, on May 1, 2025, the company divested certain Endeavor royalty assets to its subsidiary Viper in a '2025 Drop Down' transaction for **$1.0 billion** in cash and **69.63 million** Viper LLC units. The cash proceeds were used to repay **$900 million** in Tranche A Loans[153](index=153&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=45&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses strong Q1 2025 performance driven by the Endeavor acquisition, strategic post-quarter transactions, and a revised capital budget prioritizing free cash flow [First Quarter 2025 Financial and Operating Highlights](index=45&type=section&id=First%20Quarter%202025%20Financial%20and%20Operating%20Highlights) Q1 2025 highlights include **$1.4 billion** net income, **850.7 MBOE/d** average production, and **$942 million** in capital expenditures Q1 2025 Key Metrics | Metric | Value | | :--- | :--- | | Net Income | $1.4 billion | | Average Production | 850.7 MBOE/d | | Dividends Paid | $290 million | | Stock Repurchased | $575 million | | Cash Operating Costs | $10.48 per BOE | | Cash Capital Expenditures | $942 million | [Results of Operations](index=51&type=section&id=Results%20of%20Operations) Q1 2025 results show a **74%** year-over-year revenue increase driven by production volume growth from acquisitions, with quarter-over-quarter revenue up due to higher prices - **YoY Comparison (Q1 2025 vs Q1 2024):** - Oil, natural gas, and NGL revenues increased by **$1.6 billion (74%)**, driven by an **82%** growth in combined production volumes, with **73%** of the increase from the Endeavor Acquisition[207](index=207&type=chunk)[208](index=208&type=chunk) - Lease operating expenses increased in total due to costs from acquired Endeavor wells, but decreased on a per-BOE basis from **$6.08** to **$5.33**[212](index=212&type=chunk) - DD&A expense increased by **$613 million**, driven by production growth and a higher depletion rate from the addition of higher-value assets[212](index=212&type=chunk) - **QoQ Comparison (Q1 2025 vs Q4 2024):** - Oil, natural gas, and NGL revenues increased by **$186 million**, as a **$306 million** improvement from higher prices was partially offset by a **$120 million** decrease from a **6%** decline in production volumes[188](index=188&type=chunk) - Lease operating expenses decreased by **$53 million**, primarily due to reduced cost estimates for Endeavor properties and a volume discount for water services[191](index=191&type=chunk) Production and Average Prices | Metric | Q1 2025 | Q1 2024 | Q4 2024 | | :--- | :--- | :--- | :--- | | Daily Combined Volumes (BOE/d) | 850,656 | 461,110 | 883,424 | | Oil ($ per Bbl) | $70.95 | $75.06 | $69.48 | | Natural Gas ($ per Mcf) | $2.11 | $0.99 | $0.48 | | Combined ($ per BOE) | $47.77 | $50.07 | $42.71 | [Liquidity and Capital Resources](index=63&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company maintained strong liquidity of **$3.8 billion** and revised its 2025 capital budget to prioritize free cash flow - At March 31, 2025, the company had approximately **$3.8 billion** of liquidity, consisting of **$1.3 billion** in cash and **$2.5 billion** available under its credit facility[222](index=222&type=chunk) - The company revised its 2025 capital budget to **$3.40 billion** to **$3.80 billion** to prioritize free cash flow generation due to recent weakness in commodity prices[245](index=245&type=chunk) - The company maintains a commitment to return at least **50%** of free cash flow to stockholders through base dividends, variable dividends, and share repurchases[249](index=249&type=chunk) - In Q2 2025, the company repurchased **$220 million** in principal of its senior notes in open market transactions for **$167 million**[248](index=248&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=71&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages primary market risks, including commodity price volatility and interest rate exposure, through derivative instruments and swaps - The company's main market risk is the pricing of its oil and natural gas production. It uses derivative instruments to reduce price volatility[261](index=261&type=chunk)[262](index=262&type=chunk) - A sensitivity analysis shows that a **10%** increase in forward commodity prices would decrease the net asset value of its derivatives by **$2 million**, while a **10%** decrease would increase it by **$15 million**[263](index=263&type=chunk) - The company is exposed to interest rate risk on its revolving credit facilities and Tranche A Loans. It also uses interest rate swaps with a notional amount of **$900 million** to manage fair value changes on its fixed-rate debt[266](index=266&type=chunk)[268](index=268&type=chunk) [Controls and Procedures](index=73&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective as of March 31, 2025, excluding recently acquired Endeavor entities from internal control assessment - Management concluded that disclosure controls and procedures were effective as of March 31, 2025[270](index=270&type=chunk) - The assessment of internal control over financial reporting did not include the internal controls of the entities acquired in the Endeavor Acquisition, as the company is still in the process of integration[271](index=271&type=chunk) [PART II. OTHER INFORMATION](index=74&type=section&id=PART%20II.%20OTHER%20INFORMATION) Part II provides additional information on legal proceedings, risk factors, equity sales, and other disclosures [Legal Proceedings](index=74&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in routine legal proceedings not expected to materially impact its financial condition or operations - The company is party to various routine legal proceedings arising in the ordinary course of business, which are not expected to have a material adverse effect[274](index=274&type=chunk) [Risk Factors](index=74&type=section&id=Item%201A.%20Risk%20Factors) Risk factors remain largely unchanged from the 2024 10-K, with an added emphasis on potential impacts from U.S. trade policy changes - Risk factors are largely unchanged from the Annual Report on Form 10-K for the year ended December 31, 2024[276](index=276&type=chunk) - The report highlights the risk that changes in U.S. trade policy, tariffs, and trade restrictions could cause market volatility, reduce demand for oil and gas, and have a material adverse effect on the business[277](index=277&type=chunk)[278](index=278&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=75&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q1 2025, the company repurchased **3.66 million** shares for approximately **$575 million**, with **$2.1 billion** remaining in the buyback program Q1 2025 Share Repurchases | Period | Total Shares Purchased (thousands) | Average Price Paid Per Share | Value Remaining in Plan (millions) | | :--- | :--- | :--- | :--- | | Jan 2025 | 689 | $173.16 | $2,556 | | Feb 2025 | 853 | $158.94 | $2,420 | | Mar 2025 | 2,114 | $151.87 | $2,100 | | **Total** | **3,656** | **$157.30 (approx.)** | **$2,100** | - The board of directors approved an increase in the common stock repurchase program from **$4.0 billion** to **$6.0 billion** on September 18, 2024[284](index=284&type=chunk) [Other Information](index=75&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted or terminated Rule 10b5-1 trading arrangements during Q1 2025 - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement during Q1 2025[283](index=283&type=chunk) [Exhibits](index=76&type=section&id=Item%206.%20Exhibits) This section indexes exhibits filed with the 10-Q, including merger agreements, corporate governance, and officer certifications

Diamondback Energy (FANG) Q1 2025 Earnings Call May 06, 2025 09:00 AM ET Company Participants Adam Lawlis - VP, IRTravis Stice - Chairman and CEONeil Mehta - Head of Americas Natural Resources Equity ResearchKaes Van't Hof - PresidentScott Hanold - Managing Director - Energy ResearchDavid Deckelbaum - Managing Director: Sustainability & Energy TransitionDanny Wesson - COOJohn Freeman - Managing DirectorBob Brackett - Head - Research DivisionScott Gruber - Director - Oilfield Services & Equipment ResearchDer ...

Diamondback Energy (FANG) Q1 2025 Earnings Call May 06, 2025 09:00 AM ET Company Participants Adam Lawlis - VP, IRTravis Stice - Chairman and CEONeil Mehta - Head of Americas Natural Resources Equity ResearchKaes Van't Hof - PresidentScott Hanold - Managing Director - Energy ResearchDavid Deckelbaum - Managing Director: Sustainability & Energy TransitionDanny Wesson - COOJohn Freeman - Managing DirectorBob Brackett - Head - Research DivisionScott Gruber - Director - Oilfield Services & Equipment ResearchDer ...

Diamondback Energy (FANG) Q1 2025 Earnings Call May 06, 2025 09:00 AM ET Speaker0 Good day, and thank you for standing by. Welcome to the Diamondback Energy First Quarter twenty twenty five Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. To ask a question during the session, you will need to press 11 on your telephone. You will then hear an automated message advising your hand is raised. To wit ...

Diamondback Energy (FANG) came out with quarterly earnings of $4.54 per share, beating the Zacks Consensus Estimate of $4.09 per share. This compares to earnings of $4.50 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 11%. A quarter ago, it was expected that this energy exploration and production company would post earnings of $3.26 per share when it actually produced earnings of $3.64, delivering a surprise of 11.66%.Over th ...

Investor Presentation May 2025 1 Forward-Looking Statements and Non-GAAP Financial Measures Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, which involve risks, uncertainties, and assumptions. All statements, other than statements of historical fact, that Diamondback Energy, Inc. ("Diamondback," the "Company" or we) makes, including statements regarding future performance; business ...