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Research Alert: Fang: A Strong Q1 Eps Beat On Strong Production

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CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

FANG delivered a strong Q1 EPS beat of $4.23, surpassing consensus by $0.48, driven by production of 979,400 boe/d that rose 15% Y/Y and exceeded Street expectations by 2.7%. Crude oil production of 521,000 b/d topped the high end of guidance despite weather disruptions, achieved with below-midpoint capex of $933M. We think FANG's shift away from a formulaic shareholder return approach is prudent, allowing more flexibility rather than rigid quarterly percentages. The company raised 2026 production guidance to at least 520,000 b/d for crude and 972,000 boe/d total, up from the prior range of 926K-962K boe/d. Free cash flow rose 10% to $1.7B in Q1, though we anticipate a surge in Q2 given WTI's 57% rise since February. FANG returned $548M via buybacks at $167.61/share and raised the dividend 5% to $1.10/share, yielding 2.0%. We believe saving incremental FCF is wise given our expectation that 2027 crude prices may decline after a strong 2026.

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