Analyst Sam Burwell noted that the company plans to add the fifth rig in Midlands in the coming week and its sixth in Delaware early next year. The company had estimated WTI prices of $45 for meeting the capital expenditure and had indicated that at current strip prices, it would not outspend cash low next year.
Canaccord noted that the company's third-quarter volumes were very strong at 44.9 MBoe/day and it raised its 2016 production guidance to show sequential growth in the fourth quarter. Preliminary 2017 guidance was also above consensus and nearly topped the firm's very optimistic estimate, it noted.
Given the impressive guidance, the firm said the company continues to be one of the top performers in the Permian. According to the firm, the growth was made possible by a depth of quality inventory, top-tier corporate level capital efficiency and a sterling balance sheet.
Canaccord has a Buy rating on the shares of the company, while it raised its price target to $116 from $103.
At time of writing, Diamondback Energy shares were up 0.14 percent at $105.36.
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