stocks
Best Stocks: An energy stock that's a cash-flow machine and in a nice uptrend
Josh and Sean profile an energy stock that pays a big dividend, buys back a lot of stock and just broke out.
TL;DR
- Diamondback Energy (FANG) is committed to returning at least 50% of quarterly free cash flow to shareholders.
- The company has returned $892M through dividends and share buybacks by Q3, representing 50% of free cash flow.
- FANG has grown its dividend payout by 7.2% annually since 2018 and has an $8B share buyback authorization.
- The company maintains a "best-in-class cost structure," with a breakeven price of $30 per barrel.
- The stock has confirmed a technical breakout after six months of range-bound consolidation.
- FANG is trading above its 50-day and 200-day moving averages, with momentum reasserting itself.
- Key resistance is around $170–$172, with support at the 200-day moving average near $145.