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what it is
Viper gets paid when oil and gas come out of land it owns mineral rights under, mostly in West Texas.
how it gets paid
Last year Viper Energy made $1.3B in revenue. Oil royalties was the main engine at $0.94B, or 72% of sales.
why it's growing
Revenue grew 57.6% last year. Revenue reached $924M, up 135% vs. prior year, while EPS rose 148% vs. prior year from a low base.
what just happened
Latest quarter EPS came in at $0.31, missing the $0.40 estimate by 22.5%, even as revenue jumped hard.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
15/100 earnings predictability — expect surprises
10.5x trailing p/e — the market's not buying it — or you found a deal
5.0% dividend yield — cash in your pocket every quarter
13.5% return on capital — nothing to write home about
xvary composite: 42/100 — below average
What they do
Viper gets paid when oil and gas come out of land it owns mineral rights under, mostly in West Texas.
This is a royalty model, not a drill-it-yourself model. Royalty interest → a cut of production revenue without paying most well costs → so what: you keep more when prices stay high and you bleed less when they do not. Viper controls mineral interests under 787,264 gross acres and had 381 gross horizontal wells in development at 12/31/24, so your cash flow rides on a huge Permian footprint.
How they make money
$1.3B
annual revenue · their business grew +57.6% last year
Oil royalties
$0.94B
Natural gas royalties
$0.18B
NGL royalties
$0.14B
Lease bonus and other
$0.04B
The products that matter
owns mineral acreage
Mineral Interests
$1.3B business · 29.4% net margin
this is the asset base underneath the whole company. the snapshot does not break out exact segment revenue, so the clean read is that the full $1.3B revenue stream depends on the quality and activity of these interests.
asset base
collects production royalties
Royalty Interests
capital-light model · 94.0% operating margin
royalties mean you get paid when others produce. that helps create a 94.0% operating margin on paper, but the recent quarter showed those margins do not protect you from impairments, financing costs, or commodity volatility.
cash engine
acquired royalty portfolio
Sitio assets
$520M acquisition
the $520M deal is the near-term swing factor. if it lifts volume and supports the expected $430M fourth-quarter revenue, it helps justify the growth story. if integration costs linger, it becomes a more expensive lesson.
swing factor
Key numbers
10.5x
trailing p/e
P/E → stock price versus yearly profit → so what: you are paying $10.50 for each $1 of trailing earnings.
5.0%
dividend yield
Dividend yield → cash paid to you each year as a share of the stock price → so what: this pays you while you wait.
13.5%
return on capital
Return on capital → profit made from money invested in the business → so what: Viper turns assets into earnings better than many commodity names.
$2.2B
long-term debt
Long-term debt → money owed over many years → so what: leverage is real, but it is 15% of capital, not the whole story.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 50 / 100
- long-term debt $2.2B (15% of capital)
- net profit margin 71.7% — keeps 72 cents of every dollar in revenue
- return on equity 20% — $0.20 profit for every $1 investors have put in
B++ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in VNOM 3 years ago → it's now worth $13,050.
The index would have given you $14,770.
source: institutional data · total return
What just happened
missed estimates
Latest quarter EPS came in at $0.31, missing the $0.40 estimate by 22.5%, even as revenue jumped hard.
Revenue reached $924M, up 135% vs. prior year, while EPS rose 148% vs. prior year from a low base. The quiet part out loud: sales can surge and the stock can still get judged on a 9-cent miss.
$924M
revenue
$0.31
eps
+135%
revenue growth
the number that mattered
The 22.5% EPS miss mattered most because it tells you this stock trades on payout power, not just on top-line growth.
-
viper energy experienced a big third-quarter loss.this was due to $360 million in impairment charges, a doubling of interest expense to $32 million, and a $32 million loss on extinguishment of debt. the impairment charge was a result of a write down of properties acquired from major lessor, diamondback (fang) in a drop down transaction on may 1, 2025.
-
absent the charge, share net would have been $0.33.
-
in 2025, revenues should be up, but earnings will likely be down.
-
we are looking for fourth-quarter sales and share earnings of $430 million and $0.32, respectively.the top line ought to increase thanks to the august 19th sitio royalties acquisition, as well as greater unit volume.
-
however, earnings are expected to decline due to higher costs associated with the sitio amalgamation, dilution of the share base, higher interest costs, the aforementioned asset impairment writedown, and lower average oil prices, which probably fell 11% for the year.
source: company earnings report, 2026
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What could go wrong
the #1 risk is oil and gas price weakness hitting royalty revenue.
med
commodity price exposure
this is still a $1.3B royalty business tied to production economics. if oil and gas prices drop, the cash machine slows without asking your permission.
a broad price slump would pressure the revenue base that supports both distributions and debt service.
med
Sitio integration and deal payback
the August 19 Sitio acquisition cost $520M. if it fails to lift volumes and support the expected $430M quarter, growth starts looking purchased rather than earned.
you would be left with more complexity and cost, without the revenue follow-through investors are waiting for.
med
debt and financing drag
long-term debt sits at $2.2B, and quarterly interest expense doubled to $32M. that's manageable until commodity prices soften at the same time financing costs stay elevated.
the model can absorb leverage in good markets. in weaker markets, interest expense starts taking a louder share of the story.
a weaker tape in energy would hit the $1.3B revenue base first, while $2.2B of debt and a fresh $520M acquisition limit how forgiving the setup is.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
fourth-quarter revenue vs. $430M
this is the cleanest test of whether the post-acquisition revenue story is actually showing up in the numbers.
risk
interest expense after the debt work
$32M of quarterly interest expense is tolerable. if that stays elevated while EPS stays thin, the balance sheet becomes a bigger character in the story.
calendar
the next earnings print
the market already knows about the ugly quarter. what matters next is whether EPS rebounds toward the expected $0.32.
trend
commodity tape vs. stock tape
if oil and gas stabilize but VNOM still cannot lift off a bottom 5% short-term outlook, the market is telling you the issue is not just the commodity backdrop.
Analyst rankings
short-term outlook
bottom 5%
momentum score 5 — the weakest bucket. in human-speak, analysts expect this stock to lag badly in the near term.
risk profile
average
stability score 3 — neither especially safe nor unusually dangerous. you are taking normal stock volatility plus commodity exposure.
chart momentum
average
technical score 3 — no strong trend signal. the chart is not rescuing the fundamentals here.
earnings predictability
15 / 100
earnings predictability this low means you should expect noisy quarters, non-cash charges, and headline results that look worse than the underlying business some of the time.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 278 buyers vs. 125 sellers in 3q2025. total institutional holdings: 0.2B shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$32
$86
$37
current price
$59
target midpoint · +61% from current · 3-5yr high: $55 (+50% · 16% ann'l return)
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