Financial Data and Key Metrics Changes - In Q4 2025, Viper Energy achieved over $8 billion in mineral acquisitions and significant growth in both absolute and per share metrics, with a nearly 2.5 times increase in Permian Basin acreage and a 7% increase in oil production per share year-over-year [4][5] - The company reported a pro forma net debt of approximately $1.6 billion, representing just over 1 turn of leverage after fully repaying a $500 million term loan and outstanding revolver balance [5][6] - The board approved a 15% increase in the base dividend, which now represents about 50% of estimated 2026 free cash flow at $50 WTI, and is fully covered below $30 WTI [6][7] Business Line Data and Key Metrics Changes - Viper Energy's relationship with Diamondback Energy remains strategic, supporting development across their Permian acreage, which is characterized by strong activity levels [4][5] - The company has initiated average daily production guidance for 2026, implying mid-single digit organic production growth from the Q4 2025 exit rate [4] Market Data and Key Metrics Changes - The company has not observed a slowdown in third-party activity, capturing about 50% of all third-party operations across the entire basin, supported by major players in the industry [19][20] - The guidance for production growth is based on existing DUCs and permits, with expectations for strong third-party activity to continue [20] Company Strategy and Development Direction - Viper Energy is focused on generating strong free cash flow, delivering attractive shareholder returns, and pursuing accretive Permian consolidation opportunities [8] - The company emphasizes the importance of mineral ownership, which allows it to benefit from operators' innovations without incurring capital risk [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to return upwards of 100% of cash available for distribution while maintaining differentiated growth in per share metrics [7][8] - The outlook for the Permian Basin remains positive, with expectations for production growth and continued activity from major operators [78][79] Other Important Information - The company is enhancing its operational efficiency through automation and AI to manage a large number of leases and production data effectively [68] - Viper Energy is positioned to explore new development areas as gas takeaway improves, which could enhance lease bonus income [66] Q&A Session Summary Question: Insights on Barnett and Viper's ownership - Management highlighted the benefits of mineral ownership and the ongoing leasing program, with about 10%-15% of potential acreage leased in the Midland Basin [10][11] Question: Return of capital strategy - The board's decision to increase the base dividend reflects confidence in the company's cash-generating ability, with a focus on maintaining flexibility in capital allocation [14][15] Question: Third-party activity outlook - Management confirmed strong third-party activity, with no significant slowdown observed, and emphasized the importance of acquiring high-quality royalty interests [19][20] Question: M&A environment and royalty assets - Management noted a lack of large deals recently, with a focus on integrating previous acquisitions and being ready for future opportunities as market conditions improve [27][28] Question: 2026 oil guidance and visibility - The wide guidance range reflects limited visibility on future activity, with confidence in the first half of the year but uncertainty in the second half [38][40] Question: Lease bonus income outlook - Management indicated that lease bonus income could remain similar in 2026, driven by proactive management and the larger asset base [66][68] Question: Oil cut trends - The decrease in oil cut from mid-50s to low 50s is attributed to various factors, including improved gas system efficiency and the overall performance of the basin [69] Question: Share repurchase strategy - Management discussed the flexibility in capital allocation, balancing between distributions and share repurchases, particularly in light of market conditions [75][76]

Financial Data and Key Metrics Changes - Viper Energy reported over $8 billion in mineral acquisitions during 2025, leading to significant growth in both absolute and per share metrics [3] - The company grew its Permian Basin acreage by nearly 2.5 times year-over-year and increased oil production per share by 7% [3] - Pro forma net debt was approximately $1.6 billion, representing just over 1 turn of leverage after repaying a $500 million term loan and outstanding revolver balance [4] Business Line Data and Key Metrics Changes - The company initiated average daily production guidance for 2026, implying mid-single digit organic production growth from the Q4 2025 exit rate [3] - Viper Energy returned 90% of available cash during Q4 2025 and is positioned to increase returns to upwards of 100% of cash available for distribution [5] Market Data and Key Metrics Changes - The company has not observed a slowdown in third-party activity, capturing about 50% of all activity across the entire basin [20] - The guidance for production growth is based on existing DUCs and permits, with visibility expected to improve as new wells are permitted [38] Company Strategy and Development Direction - Viper Energy is focused on generating strong free cash flow and delivering attractive shareholder returns while pursuing accretive Permian consolidation opportunities [6] - The company has approved a 15% increase in its base dividend and a $1 billion increase in share repurchase authorization, reflecting confidence in long-term cash generation [4] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strength of the Permian Basin, indicating that larger operators continue to grow and that concerns about reductions in activity have quieted [75] - The company is well-positioned to benefit from the ongoing development of deeper zones and the resilience of third-party operators [20][21] Other Important Information - The company is leveraging technology and automation to manage a large number of leases and production data effectively, which is expected to enhance shareholder value [65] - The relationship with Diamondback Energy remains strategic, with ongoing leasing activities and development plans that align with Viper's interests [10][50] Q&A Session Summary Question: How does Viper Energy's ownership translate across FANG's Barnett position? - Management highlighted the benefits of mineral ownership, stating that operators' new techniques and zones accrue benefits to mineral owners without additional capital risk [9] Question: Will the return of capital strategy remain consistent? - Management indicated that the base dividend will remain a priority, with flexibility to adjust based on market conditions and stock price [12][14] Question: What is the outlook for third-party activity? - Management confirmed that third-party activity remains strong, with no significant slowdown observed [20] Question: How does the company view the current market for royalty assets? - Management noted that while there haven't been many large deals recently, they are ready to pursue larger opportunities when market conditions improve [26][28] Question: What is the outlook for lease bonus income in 2026? - Management suggested that lease bonus income could remain similar to 2025 levels, driven by proactive management and the larger asset base [64] Question: How does the company view its oil cut trend? - Management attributed the trend towards lower oil cut to various factors, including improved efficiency in gas systems and the overall performance of the basin [66]

Core Insights - ConocoPhillips (COP) acquired Marathon Oil in November 2024, significantly expanding its low-cost resource base in the U.S. Lower 48 region [1][3] - The acquisition has led to a nearly 25% increase in low-cost supply, primarily from Marathon Oil's Permian Basin resources [2] - COP is on track to achieve over $1 billion in annual synergies by the end of 2025, doubling initial estimates of $500 million [2][8] - The company has optimized production by implementing a steady-state drilling program, reducing the number of rigs and frac crews by almost 30% [2][8] Company Positioning - The acquisition strengthens COP's position as a leading shale operator in the U.S., enhancing its cash flow profile and future profit potential [3] - COP's shares have declined by 5.4% over the past year, compared to a 10.8% decline in the industry [7] - The company's current enterprise value to EBITDA (EV/EBITDA) ratio stands at 5.43x, below the industry average of 11.22x [10] Earnings Estimates - The Zacks Consensus Estimate for COP's 2025 earnings has been revised downward over the past 30 days, with current estimates at $6.38 per share [12]

Group 1 - Viper Energy, Inc. (NASDAQ:VNOM) is considered one of the best safe stocks to buy, with an 'Outperform' rating and a revised price target of $51.00, indicating a potential upside of nearly 34.7% [1] - The research firm anticipates a rise in gas prices over the next 12 months, positioning Viper Energy for long-term growth, as gas stocks are currently trading at a 10% to 15% discount compared to implied commodity prices [2] - Viper Energy's $4.1 billion acquisition of Sitio Royalties is expected to provide synergies across the Permian region and enhance oil and gas production, making it an attractive investment for those seeking limited operational downside risks [3] Group 2 - Viper Energy, Inc. is a Texas-based company specializing in oil and natural gas properties in North America, founded in 2013, with a commitment to maximizing long-term returns [4]

Core Viewpoint - Investors have become less optimistic about Diamondback Energy's future following a price target reduction by an analyst, resulting in a more than 5% loss in stock value on that trading day [1] Group 1: Analyst Actions - Tim Rezvan from KeyCorp's KeyBanc Capital Markets lowered his price target for Diamondback Energy to $176 per share from $180, while maintaining an overweight (buy) rating on the stock [2] - The price target adjustment was influenced by Diamondback's revision of natural gas price estimates and the acquisition of Sitio Royalties by its subsidiary Viper Energy [4] Group 2: Acquisition Details - Viper Energy completed an all-cash acquisition of Sitio Royalties valued at $4.1 billion, which closed in mid-August [5] - Following the acquisition, Viper raised its base dividend by 10% and revised its third-quarter production guidance to an average of 104,000 to 110,000 barrels of oil equivalent per day [4][5] Group 3: Financial Performance - Diamondback Energy reported a nearly 50% year-over-year increase in revenue, reaching $3.68 billion in the second quarter [6] - Despite a decline in adjusted net income, the company still posted a profit of $785 million [6]

Company Overview - Viper Energy (NASDAQ: VNOM) has recently completed the acquisition of Sitio Royalties, which significantly enhances its production capacity to approximately 126,000 BOEPD [2] Production Growth - Following the acquisition, Viper Energy anticipates mid-single-digit production growth from the new production level by 2026 [2]

Core Insights - Viper Energy, Inc. (VNOM) is acquiring Sitio Royalties for $4.1 billion, highlighting the ongoing profitability of operations in the Permian Basin despite declining crude prices [3][5][6] - The acquisition will increase VNOM's net royalty acres in the Permian to 85,700, with expected production of 122,000-130,000 barrels of oil equivalent per day by Q4 2025 [3][4][9] - The deal reflects the enduring attractiveness of the Permian Basin, where break-even costs are significantly low, making operations profitable even with current WTI prices below $65 per barrel [6][10] Company and Industry Analysis - The acquisition by VNOM indicates a positive outlook for midstream players like Enterprise Products Partners LP (EPD) and producers like Occidental Petroleum (OXY), as increased activity in the Permian is anticipated [2][9] - Occidental holds 2.9 million net acres in the Permian, with break-even costs below $50 per barrel, ensuring profitability in the current pricing environment [10] - EPD has a strong presence in the Permian and has connected over 1,000 new oil and gas wells to its infrastructure, with expectations for similar growth in the second half of 2025 [12][13]

Financial Data and Key Metrics Changes - The first quarter of 2025 marked a record production quarter for the company, with total production up 3% quarter over quarter, averaging over 42,000 BOE per day [6] - Adjusted EBITDA was $142 million, reflecting a 1% increase from the prior quarter, while net income rose 36% to $26 million [7] - The company declared a cash dividend of $0.35 per share and repurchased 1,100,000 shares for $22 million during the first quarter, representing a return of capital of $0.50 per share [7][8] Business Line Data and Key Metrics Changes - Net wells turned in line increased by 34% from Q4 2024, primarily driven by activity in the Delaware Basin [6] - The company closed over $20 million in acquisitions, adding 1,350 net royalty acres [6] Market Data and Key Metrics Changes - The company updated its full-year 2025 estimated cash taxes guidance to $23 million, reflecting a $5 million decrease from the original estimate due to lower anticipated commodity prices [9] Company Strategy and Development Direction - The company emphasizes the advantages of minerals and royalties as a high-margin investment opportunity, with no direct operating costs or obligatory capital spending [10][11] - The focus remains on asset quality, operator quality, and asset/operator diversity to maximize returns [19] - The company is actively evaluating consolidation opportunities in the fragmented minerals and royalties market [19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the production trajectory for the next two quarters, underpinned by existing producing wells [26] - The company remains optimistic about the long-term outlook for oil and natural gas, despite short-term price fluctuations [60] - Management noted that operators are curtailing capital expenditures while maintaining production guidance, indicating a cautious approach to capital discipline [58] Other Important Information - The company has a remaining buyback capacity of approximately $350 million following the Board's authorization for an additional $300 million in share repurchases [8][22] - The company has increased its inventory estimate by 40 additional net normalized locations, a 10% quarter-over-quarter increase [16] Q&A Session Summary Question: Outlook on production trajectory for the next two quarters - Management feels relatively good about production trajectory, underpinned by existing producing wells and wells that have been spud [26][27] Question: Comparison of share repurchase value versus M&A opportunities - Management sees a balance between the value of buying back stock and pursuing M&A opportunities, noting the unique value proposition of their stock [28][30] Question: Changes in productivity of wells relative to underwritten assumptions - Management conducts look backs on past acquisitions and feels confident about future projections based on current geologic facts [32][36] Question: Clarification on 1Q production and full-year guidance - Management is pleased with 1Q production but expects to revisit guidance later in the year based on more data [40][41] Question: Trend of share repurchases in relation to commodity price volatility - Management's buyback program is designed to take advantage of price dislocations, with an expectation of increased repurchases at lower prices [44] Question: Context on the increase of 40 net locations - The increase was split between the Delaware and Midland Basins, based on positive well results and operator activity [50][52] Question: Observations on operators' strategies for managing base decline - Management noted that operators are being cautious with capital discipline, which may lead to a self-correcting nature in the industry [58][60]

Financial Data and Key Metrics Changes - The first quarter of 2025 marked a record production quarter for the company, with total production up 3% quarter over quarter, averaging over 42,000 BOE per day [5] - Adjusted EBITDA was $142 million, reflecting a 1% increase from the prior quarter, while net income rose 36% to $26 million [6] - The company declared a cash dividend of $0.35 per share and repurchased 1,100,000 shares for $22 million, representing a return of capital of $0.50 per share for the first quarter [6][7] Business Line Data and Key Metrics Changes - Net wells turned in line increased by 34% from Q4 2024, primarily driven by the Delaware Basin [5] - The company closed over $20 million in acquisitions, adding 1,350 net royalty acres [5] Market Data and Key Metrics Changes - The company updated its full-year 2025 estimated cash taxes guidance to $23 million, reflecting a decrease of $5 million from the original estimate due to lower anticipated commodity prices [8] Company Strategy and Development Direction - The company emphasizes the unique advantages of minerals and royalties as an asset class, highlighting their non-cost-bearing nature and high-margin investment opportunities [10][11] - The focus is on asset quality, operator quality, and asset/operator diversity to maximize returns [18] - The company is actively evaluating consolidation opportunities in a fragmented market, aiming to enhance its portfolio [18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the quality of assets and their ability to compete for operator capital in various commodity price environments [20] - The company remains cautious about the current market dynamics but believes in the long-term value of its assets [60] Other Important Information - The company has maintained a disciplined approach to acquisitions, focusing on high-quality assets and operators [18] - The company has repurchased over 4% of its stock in the last fourteen months, with an additional $300 million authorized for share repurchases [21] Q&A Session Summary Question: Production trajectory outlook for the next two quarters - Management indicated confidence in production trajectory, supported by existing producing wells and wells that have been spud [26] Question: Comparison of share repurchase value versus M&A opportunities - Management highlighted a balance between share repurchases and M&A opportunities, noting the unique value proposition of their stock [27][29] Question: Insights on production guidance and operator strategies - Management acknowledged the strong first-quarter production but indicated that guidance may be revisited based on future data [40] Question: Context on inventory increase of 40 net locations - Management explained that the increase was due to successful well results in the Delaware and Midland Basins, reflecting ongoing operator activity [50] Question: Observations on operators' strategies for managing base decline - Management noted that operators are curtailing CapEx while maintaining production guidance, indicating a cautious approach to capital discipline [58]

Financial Data and Key Metrics Changes - The company achieved record fourth quarter production of approximately 41,000 barrels of oil equivalent per day, a 14% year-over-year increase, and averaged over 39,000 barrels of oil equivalent for the year [7] - Adjusted EBITDA for the fourth quarter was $141,200,000, which was 4% higher than the prior quarter, reflecting strong production and lower than expected cash G&A [15] - The company returned $330,000,000 to shareholders in 2024, representing over 70% of discretionary cash flow [12] Business Line Data and Key Metrics Changes - The company closed 16 high-value acquisitions throughout the year, totaling more than $350,000,000, which were immediately accretive to discretionary cash flow per share [10] - The fourth quarter acquisitions added 3,300 net royalty acres to the portfolio, primarily in the Delaware Basin [11] Market Data and Key Metrics Changes - The company expects oil production at the midpoint to be 18,500 barrels per day and total production just under 40,000 BOE per day in 2025, representing a 3% increase over reported full year 2024 production [18] - The company has a strong presence in the Permian Basin, covering about 36% of the entire basin, with a higher concentration in the Texas part of the Delaware Basin [40] Company Strategy and Development Direction - The company is committed to a strong balance sheet and financial flexibility, with a borrowing base increased to $925,000,000 [11] - The company prioritizes capital returns to shareholders while also investing in high-rate return acquisitions [60] - The company aims to leverage its proprietary asset management systems to enhance efficiency and scalability [23] Management's Comments on Operating Environment and Future Outlook - Management noted that the acquisition environment remains robust, with a healthy deal flow and attractive opportunities for high return investments [20] - The company views the current natural gas market as favorable, with increasing demand expected to support long-term growth [45] - Management expressed confidence in maintaining production growth and financial strength despite market fluctuations [78] Other Important Information - The company captured $19,000,000 of missing revenue payments in 2024, offsetting over two-thirds of cash G&A [9] - The company has returned nearly $850,000,000 to shareholders since going public in mid-2022, representing nearly 30% of its current market capitalization [12] Q&A Session Summary Question: Can you talk about your various marketed deals and how they compare to the deals you completed? - Management highlighted a robust year for deal flow, emphasizing the consistency in their acquisition program and the high rate of return opportunities they pursued [26][27] Question: What does activity look like for the remainder of the year versus expectations? - Management indicated that guidance for 2025 is underpinned by operator activity that has already commenced, suggesting a stable outlook for production growth [33] Question: How would you frame your production trajectory for 2025? - Management expects contributions primarily from the Permian Basin, with a focus on line of sight development in the DJ Basin [38] Question: Does the more constructive natural gas backdrop change the size of the opportunity set? - Management noted that the investments made in people and systems lend themselves to scale, enhancing their ability to capitalize on market opportunities [42] Question: Can you provide color behind the cash G&A increase? - Management explained that the increase is due to investments in people and systems, which are expected to scale effectively in the future [66] Question: What are your strategic priorities for free cash flow allocation in 2025? - Management emphasized returning capital to shareholders as the top priority while also looking for high-rate return acquisition opportunities [60]