Management and incentives

Diamondback Energy, Inc. FANG

Diamondback's board certified its 2025 executive scorecard at 161% of target in the same year the company wrote off $3.7B of oil and gas properties and net income fell by half. The plan pays Kaes Van't Hof to spend less than the budget, drill cheaper barrels and grow cash per share, which means he holds the drilling budget flat, retires shares to lift the per-share number, and lets the write-downs sit outside every metric that decides his pay.

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Diamondback Energy, Inc. FANGThe bet you're really making is that oil stays high enough for Diamondback's low-cost Permian barrels, drilled in West Texas, to keep producing cash. You're betting they keep pumping those barrels and paying down the debt from the Endeavor deal, and that the natural gas coming up alongside the oil stops selling for less than nothing at the Waha hub near the wells. Right now it is going well, with one thing to watch: the biggest sales quarter in company history at $5.6 billion, up 51% from a year earlier, while that gas again fetched negative prices at the wellhead. You pay about nine times the cash the company generated over the past year, the cheap end of where the stock has sat since 2021. Company reportSep 6 Devon Energy Corporation DVNThe bet you're really making is that Devon keeps pulling oil out of West Texas cheaply enough to make money at prices well below today's. You're betting the company it bought this spring makes the average barrel cheaper, not just adds more of them. Right now it is going well: the largest sales quarter in the company's history, roughly double the one before as the merger landed, with profit swinging back hard after a weak start to the year. You pay about 11 times the past year's earnings and roughly 8 times what the combined company now earns in a year, toward the top of what the stock has fetched over the last five years. Company reportSep 7 SolarEdge Technologies, Inc. SEDGThe bet you're really making is that people in Europe and America keep putting solar panels on their roofs, and keep buying SolarEdge's box that turns that sunlight into power the house can use. You're betting the mountain of unsold inverters that piled up in European warehouses, the thing that nearly killed the company, is finally gone, so what SolarEdge ships now matches what people actually install. Right now it is turning: revenue grew 20% from a year ago, and for every dollar of product it keeps 28 cents after building it, up from 11 cents, though it still loses money overall. You pay about 19 times the profit analysts pencil in for 2028, two years out with no profit before then, about the middle of what the stock cost in its normal years before the pandemic. Company reportSep 7 Plug Power Inc. PLUGThe bet you're really making is that Plug Power can build a green-hydrogen business, fuel cells for the forklifts in giant warehouses and the hydrogen to run them, faster than it burns through its cash. You're betting it stops losing money on the things it sells before the money runs out, because for a decade it sold that gear for less than it cost to make. Right now it is finally close on that one line: last quarter it came within a whisker of breaking even on the cost of what it sold, the best in years, though it still lost $188 million overall and its cash keeps draining. You pay about 4 times yearly sales for a company that has never turned a full-year profit in its 29 years and holds only $162 million in cash against losses that size. Company reportSep 7