Why Diamondback Energy Stock Rallied 21% in December
Shares of Diamondback Energy (NASDAQ: FANG) surged 21.1% in December, according to data provided by S&P Global Market Intelligence. Fueling the oil stock's rally was a double dose of acquisition news.
Diamondback Energy joined the oil patch's recent M&A wave with not one, but two deals last month. The big one is an all-stock transaction to acquire QEP Resources (NYSE: QEP) for $2.2 billion, including its $1.6 billion in debt. On top of that, Diamondback agreed to buy the assets of Guidon Energy in a cash-and-stock deal valued at around $1 billion. Both deals are accretive to the company's cash flow and free cash flow per share, its leverage metrics, and will reduce its reinvestment ratio in 2021.
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Source Fool.com
