Diamondback Energy (FANG) Top 2016 Pick at Sterne Agee CRT

Sterne Agee CRT analyst Tim Rezvan reiterated Diamondback Energy (NASDAQ: FANG) as his top pick for 2016. The firm maintained a Buy rating and price target of $84.

Rezvan commented: "We spent the last week fine-tuning the "Diamondback ex-mineral rights" model we maintain in tandem with our model. We assessed the value of the company's E&P assets on a stand-alone basis, which excludes the 88% ownership of LP units in Viper Energy Partners (VNOM, $14.51, Neutral). Investors should focus on valuations for the E&P segment alone - our work shows it trades nearly a turn cheaper than the consolidated company. We believe Diamondback's premium valuation is warranted, given full-cycle costs of $37/boe that may trend below $33/boe in '16. We acknowledge multiples for Permian operators remain rich, but we do not see that premium compressing in '16, and view FANG shares as the best Permian name to own in '16."

For an analyst ratings summary and ratings history on Diamondback Energy click here. For more ratings news on Diamondback Energy click here.

Shares of Diamondback Energy closed at $65.43 yesterday.

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