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Diamondback Energy Inc – Crude Petroleum and Natural Gas Extraction
diamondback energy is an independent oil and natural gas company headquartered in midland, tx. diamondback’s growth strategy is focused on the acquisition, development, exploration and exploitation of unconventional, long-life, onshore oil and natural gas reserves in the major oil producing permian basin in west texas. the company’s operations are directed primarily at the large acreage areas of the clearfork, spraberry, wolfcamp, cline, strawn and atoka formations, collectively known as the wolfberry trend.
Analysis Results
Intrinsic Value $3,098.78
Latest Price $154.27
Relative Value 95% undervalued
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Cash Flow (Billions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 35.3%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 3.8%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 35.3%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (billion) Present value (billion)
2023 6.23 6.0
2024 8.43 7.82
2025 11.4 10.2
2026 15.4 13.3
2027 20.9 17.3
Terminal Value

Assuming the company was sold after the projection period at an exit multiple of 30, the terminal value of the company would be 626 billion. This corresponds to a present value of 500 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 54.6 billion. Adding in the terminal value gives a total present value of 555 billion.

There are presently 179.0 million outstanding shares, so the intrinsic value per share is 3098.78.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 1,392,000,000
Current Cash 157,000,000
Current Liabilities 1,716,000,000
Current Debt 10,000,000
Non-Cash Working Capital (NCWC) -471,000,000
Change in NCWC 130,000,000
EBIT 6,599,000,000
Tax Provision 1,174,000,000
Depreciation and Amortization 1,344,000,000
Capital Expenditure -1,938,000,000
Unlevered Free Cash Flow 4,784,367,852
Current Assets 1,446,000,000
Current Cash 654,000,000
Current Liabilities 1,438,000,000
Current Debt 45,000,000
Non-Cash Working Capital (NCWC) -601,000,000
Change in NCWC -54,000,000
EBIT 4,094,000,000
Tax Provision 631,000,000
Depreciation and Amortization 1,275,000,000
Capital Expenditure -1,487,000,000
Unlevered Free Cash Flow 2,939,347,093
Current Assets 602,000,000
Current Cash 104,000,000
Current Liabilities 1,236,000,000
Current Debt 191,000,000
Non-Cash Working Capital (NCWC) -547,000,000
Change in NCWC -30,000,000
EBIT 535,000,000
Tax Provision -1,104,000,000
Depreciation and Amortization 1,304,000,000
Capital Expenditure -1,859,000,000
Unlevered Free Cash Flow -50,000,000
Current Assets 869,000,000
Current Cash 123,000,000
Current Liabilities 1,263,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) -517,000,000
Change in NCWC -207,893,000
EBIT 1,485,000,000
Tax Provision 47,000,000
Depreciation and Amortization 1,447,000,000
Capital Expenditure -369,000,000
Unlevered Free Cash Flow 2,162,303,132
Current Assets 925,021,000
Current Cash 214,516,000
Current Liabilities 1,019,612,000
Current Debt 0
Non-Cash Working Capital (NCWC) -309,107,000
Change in NCWC 22,166,000
EBIT 1,047,619,000
Tax Provision 168,362,000
Depreciation and Amortization 623,039,000
Capital Expenditure -1,671,571,000
Unlevered Free Cash Flow -137,182,320
Current Assets 358,601,000
Current Cash 112,446,000
Current Liabilities 577,428,000
Current Debt 0
Non-Cash Working Capital (NCWC) -331,273,000
Change in NCWC -247,523,000
EBIT 605,020,000
Tax Provision -19,568,000
Depreciation and Amortization 326,759,000
Capital Expenditure -860,738,000
Unlevered Free Cash Flow -176,482,000
Current Assets 1,792,166,000
Current Cash 1,666,574,000
Current Liabilities 209,342,000
Current Debt 0
Non-Cash Working Capital (NCWC) -83,750,000
Change in NCWC -30,959,000
EBIT 176,919,000
Tax Provision 192,000
Depreciation and Amortization 178,015,000
Capital Expenditure -374,166,000
Unlevered Free Cash Flow -50,191,000
Current Assets 108,745,000
Current Cash 20,115,000
Current Liabilities 141,421,000
Current Debt 0
Non-Cash Working Capital (NCWC) -52,791,000
Change in NCWC -7,590,000
EBIT 74,529,000
Tax Provision -201,310,000
Depreciation and Amortization 217,697,000
Capital Expenditure -902,087,000
Unlevered Free Cash Flow -617,451,000
Current Assets 251,711,000
Current Cash 30,183,000
Current Liabilities 266,729,000
Current Debt 0
Non-Cash Working Capital (NCWC) -45,201,000
Change in NCWC 29,706,000
EBIT 212,670,000
Tax Provision 108,985,000
Depreciation and Amortization 170,005,000
Capital Expenditure -544,061,000
Unlevered Free Cash Flow -207,683,882
Current Assets 61,968,000
Current Cash 15,555,000
Current Liabilities 121,320,000
Current Debt 0
Non-Cash Working Capital (NCWC) -74,907,000
Change in NCWC -19,737,000
EBIT 95,194,000
Tax Provision 31,754,000
Depreciation and Amortization 66,597,000
Capital Expenditure -294,820,000
Unlevered Free Cash Flow -187,775,905

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