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TipRanks' analyst ranking service discusses three dividend-paying stocks, including Home Depot and Diamondback Energy, highlighted by Wall Street's top pros.

It is rare to find 9%+ yielding dividend growth stocks that would qualify as blue chips. However, today, Mr. Market is offering several of them. We share two that are attractive buys on the dip.

Being able to buy high-yield, high-buyback stocks with solid balance sheets at deep discounts to NAV is extremely rare. However, there are several opportunities like this in today's market. I share two of some of my favorite opportunities like this right now.

Oil prices prices have been volatile today amid a slew of updates, moving higher after reports that Israel is preparing to strike Iran, and back lower following bearish crude data out of the U.S. West Texas Intermediate (WTI) crude was last seen down 0.7% at $61.62, adding to its 14.3% year-to-date deficit amid geopolitical tensions and potential trade disruptions.

Diamondback Energy, a cost-efficient Permian Basin pure-play, has a deep inventory of ~8,400 drilling locations, economic at $50/bbl WTI, and a base dividend breakeven price of $37/bbl WTI. Despite a 34% stock decline, Diamondback reported strong Q1 earnings with record production, $1.5 billion in free cash flow, and significant share repurchases. Risks include potential further WTI price drops due to Trump's tariffs and OPEC+ actions, and limited exit capacity for Permian gas production, though new pipelines are in development.

For 2025, FANG looks to pump around 857,000-900,000 BOE/d of hydrocarbon, with oil volumes between 480,000 and 495,000 barrels per day.

Diamondback Energy's management acknowledges potential production declines due to recessionary risks and OPEC+ pressures but emphasizes its strong cash flow and low-cost structure. Despite macro challenges, FANG focuses on cost control, efficiency, and share buybacks allow the company to maintain double-digit free cash flow yield at $60/barrel WTI. Q1 earnings highlight robust free cash flow, with significant cost reductions and efficient capital management, returning $864 million to shareholders through dividends and buybacks.

The Investment Committee debate the latest Calls of the Day.

Diamondback Energy, Inc. (NASDAQ:FANG ) Q1 2025 Earnings Conference Call May 6, 2025 9:00 AM ET Company Participants Adam Lawlis - Vice President of Investor Relations Travis Stice - CEO & Chairman of the Board Kaes Hof - President Danny Wesson - Executive VP & COO Conference Call Participants Neil Mehta - Goldman Sachs Scott Hanold - RBC Capital Markets David Deckelbaum - TD Cowen John Freeman - Raymond James Arun Jayaram - JPMorgan Securities Bob Brackett - Bernstein Research Scott Gruber - Citigroup Phillip Jungwirth - BMO Derrick Whitfield - Texas Capital Kevin MacCurdy - Pickering Energy Partners Charles Meade - Johnson Rice Paul Cheng - Scotiabank Leo Mariano - ROTH Capital Partners Kalei Akamine - Bank of America Merrill Lynch Doug Leggate - Wolfe Research Operator Good day. And thank you for standing by.

Diamondback Energy expects U.S. oil production to peak and then decline this year due to low prices. CEO Travis Stice warned that falling production threatens jobs, GDP growth, the nation's trade balance and U.S. energy security.