Diamondback Energy, Inc. FANG

Key data

What the scorecard pays for

Nothing here pays for growth. Diamondback pulled production and reserve growth out of the plan a decade ago, and what replaced it is a cost sheet with a safety rider bolted on. Van't Hof draws $1.3M in salary and can reach roughly $23.1M in a maximum year, computed from the disclosed target values. He made $14.9M in 2025.

What the bars have done

The bars moved with the results rather than ahead of them. The return-on-capital target was cut in half in two years while capital employed ran from $26.9B to $66.5B on the Endeavor purchase. Well cost went the same way, the bar loosening by $1.75 a barrel, so a 2025 well cost slightly worse than 2023's paid 200% of target where 2023 paid 123%. Bars reset after a large purchase tend to stay reset.

The one year the arithmetic came up short, the board made up the difference, applying a 25% multiplier on top of the certified 2024 scorecard. In 2025 the single miss was worker injuries, 0.62 recordable incidents per 200,000 hours against a 0.45 threshold, and it cost five points.

Both figures are computed from the proxy's indexed return table and approximate the plan's percentile math. The equity gets decided in this table, not the operating one. All three closed cycles certified at the 82nd percentile, and the two that paid 250% got there because the absolute return cleared 15% a year, not because the wells were cheap.

Halfway through 2026 the company has banked $4.1B of adjusted free cash flow, about seventy percent of the full-year figure that paid maximum last year, and 2026 capital guidance of roughly $3.9B sits exactly at the spending level that paid maximum in 2025. Lease and overhead cost is the one line drifting the wrong way, $6.48 a barrel in the second quarter against $5.81 a year earlier. The 2026 targets are not disclosed until next spring, so there is no board bar to set against the street.

What he does next

Hold the budget. Underspending it is worth 10% by itself and the same restraint feeds the cash-per-share line worth another 20%. Watch whether third-quarter capital lands inside the $950M to $1.05B he guided. Retire shares, because each one bought back lifts cash per share without producing a barrel, and the board doubled the repurchase authorization to $16.0B in July with $9.9B still open. The count is down from 289.6M to 281.2M already. Pay down debt instead of buying assets, which is what last quarter did, $1.3B off to $12.8B. There is no room for another Endeavor: the capital base is already $66.5B and the metric that punishes a bigger denominator carries a fifth of the bonus. Let the write-downs run. The 2025 ceiling-test charge and the $1.4B that followed in the first quarter of 2026 never enter adjusted earnings, so they never touch the return-on-capital metric or the cash metric.

The tape says what the plan says. Van't Hof sold 50,000 shares for $9.5M across six dates between November and August, every one a plain code S sale of owned stock, with no option exercise and no open-market purchase anywhere in the twelve months. Travis Stice, who ran the company until May 2025, sold 175,000 and is down to 49,727 shares. The ownership rule is not the brake here. Van't Hof's remaining 115,940 shares are worth about $25M at his own August sale price of $215, against a $7.8M requirement.

Closing thoughts

They pay him to spend less and turn what is left into cash per share, and he will keep doing exactly that, because the alternative costs money he would rather hand back. Follow the return-on-capital line. It is the only number on the sheet the oil price cannot deliver for him, and the bar under it has already been cut in half once.