Is Diamondback Energy, Inc. overvalued or undervalued?

As of 7 July 2025, the valuation grade for Diamondback Energy, Inc. moved from expensive to fair. The company is currently fairly valued based on its financial metrics. Key ratios include a P/E ratio of 10, an EV to EBITDA of 6.05, and a Price to Book Value of 1.07. In comparison to peers, Devon Energy Corp. has a lower P/E ratio of 7.47 and an EV to EBITDA of 3.93, while Occidental Petroleum Corp. is very expensive with a P/E of 13.39.
Despite the recent fair valuation, Diamondback has underperformed against the S&P 500, with a year-to-date return of -14.15% compared to the index's 12.22%. However, over the last five years, the stock has significantly outperformed the S&P 500 with a return of 316.46% versus 96.61%.