Diamondback Loses 4-5 Days of Production to Texas Storms

Energy company misses fourth-quarter estimates, raises dividend.
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Diamondback Energy  (FANG) - Get Report said it will lose 4 to 5 days of production due to the impact of freezing weather this month in Texas as it reported fourth-quarter results that missed analyst estimates.

The company posted adjusted net income of $130 million, or 82 cents per diluted share on revenue of $769 million for the latest quarter.

It had been expected to report adjusted net income of $131.6 million, or 84 cents a share, on sales of $772.3 million, based on a FactSet survey of 29 analysts.

In the same period a year ago, the company posted earnings of $1.93 a share on sales of $1.1 billion. It reported net income of $368 million.

The stock has risen 136.6% since the company last reported earnings on Nov. 2 on expectations that effective COVID vaccines and Federal stimulus spending will kick the economy, and energy demand, into high gear this year.

The company said the freezing weather in Texas this month has hurt. “While the impact of the recent winter storms in the Permian Basin will be significant for first quarter production, we expect to overcome this adversity for the full year 2021,” CEO Travis Stice said in a statement. 

"We are still operating in a market supported by supply that is being purposely withheld to allow global inventories to decline as demand recovers from the depths of the global pandemic. Diamondback continues to see no need to grow oil production into this artificially undersupplied market,” Stice said.

Diamondback’s board raised the company’s annual dividend 6.7% to $1.60 a share. It declared a cash dividend of 40 cents a share for the fourth quarter, payable March 11 to shareholders of record on March 4.

Shares of Diamondback fell $2.91, or 4.25% to $65.49 in after-hours trading. The stock had gained 4.3% in the regular session.