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Diamondback Energy (FANG) Gains But Lags Market: What You Should Know

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Diamondback Energy (FANG) closed the most recent trading day at $36.22, moving +1.23% from the previous trading session. This move lagged the S&P 500's daily gain of 1.47%. Elsewhere, the Dow gained 1.51%, while the tech-heavy Nasdaq added 1.11%.

Prior to today's trading, shares of the energy exploration and production company had gained 37.88% over the past month. This has outpaced the Oils-Energy sector's gain of 17.95% and the S&P 500's gain of 16.09% in that time.

Wall Street will be looking for positivity from FANG as it approaches its next earnings report date. This is expected to be May 4, 2020. In that report, analysts expect FANG to post earnings of $1.42 per share. This would mark year-over-year growth of 2.16%. Meanwhile, our latest consensus estimate is calling for revenue of $983.74 million, up 13.86% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.57 per share and revenue of $3.12 billion. These totals would mark changes of -62.91% and -21.4%, respectively, from last year.

Any recent changes to analyst estimates for FANG should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 48.73% lower. FANG is currently a Zacks Rank #5 (Strong Sell).

Investors should also note FANG's current valuation metrics, including its Forward P/E ratio of 13.93. This represents a premium compared to its industry's average Forward P/E of 5.53.

Investors should also note that FANG has a PEG ratio of 0.63 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Oil and Gas - Exploration and Production - United States stocks are, on average, holding a PEG ratio of 1.31 based on yesterday's closing prices.

The Oil and Gas - Exploration and Production - United States industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 134, which puts it in the bottom 48% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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