S&P Global Ratings Outlook Upgrade for Viper Energy Inc

S&P Global Ratings revised Viper Energy Inc (NASDAQ: VNOM) outlook from stable to positive on 2 September 2026 and reaffirmed its BBB‑ issuer credit rating. The agency cited the same drivers that prompted a parallel outlook upgrade for its parent, Diamondback Energy Inc (NASDAQ: FANG), namely improved financial metrics, robust free‑cash‑flow generation and higher production volumes.

The rating agency also affirmed VNOM’s BBB‑ rating on its unsecured notes, noting a stand‑alone credit profile of bb with a two‑notch uplift attributable to the relationship with Diamondback. Diamondback holds roughly 40 % of VNOM’s equity and retains the right to designate up to three board members, provided it maintains at least 25 % of the outstanding common stock.

Production and Reserves

  • VNOM’s oil‑equivalent production is expected to rise to a range of 132,500‑135,000 barrels per day (boe/d) in 2026, up from approximately 50,000 boe/d in 2024.
  • Proven reserves increased to 406 million boe at the end of 2025, compared with 194 million boe at the end of 2024. The reserve growth is attributed to acquisitions, notably the Riverbend Oil & Gas IX transaction that closed on 1 July 2026, and to assets divested by Diamondback announced on 3 August 2026.

Capital Return Framework Change

VNOM recently altered its capital return policy, shifting from a commitment to distribute at least 75 % of cash available to shareholders to a model that emphasizes a fixed base dividend, eliminates the variable dividend component, allows opportunistic share repurchases, and retains a larger portion of cash flow.

Financial Forecasts

S&P projects that VNOM will maintain funds‑from‑operations to debt ratios above 100 % and keep debt‑to‑EBITDA at 1x or lower over the next two years. For the parent, Diamondback, S&P expects production to stay above 1 million boe/d, a funds‑from‑operations to debt ratio above 60 %, and a reduction of total gross debt toward a $10 billion net‑debt target by year‑end 2027.

Operational Footprint

All of VNOM’s assets are located in the Permian Basin, with 106 active rigs reported as of 1 July 2026. Approximately 38 % of the acreage is operated by Diamondback on a pro‑forma basis following recent transactions.

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