Devon Energy (DVN) AI Stock Analysis

• Market Cap: $22.92B
• Dividend Yield: 3.16%
• Average Volume (3M): 7.26M
• Price to Earnings (P/E): 8.1
• Beta (1Y): 0.60
• Revenue Growth: 10.98%
• EPS Growth: -19.25%
• Country: US
• Employees: 2,300
• Sector: Energy
• Sector Strength: 69
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): 0.84
• Shares Outstanding: 634,800,000
• 10 Day Avg. Volume: 6,665,709
• 30 Day Avg. Volume: 7,259,309
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.21
• Enterprise Value/Revenue: 1.69
• Enterprise Value/Gross Profit: 3.00
• Enterprise Value/Ebitda: 3.56
• 1Y Price Target: $43.78
• Price Target Upside: 21.27% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 19

• Rating: 77 Outperform
• Price Target: $38.00 ▲(5.26% Upside)

Devon Energy's strong earnings call performance and attractive valuation are the most significant factors driving the stock score. Financial performance shows solid profitability but is tempered by liquidity challenges. Technical analysis indicates stable market trends, supporting the overall positive outlook.

Positive Factors

Financial Performance

Analyst maintains a Buy rating on Devon Energy due to its discounted valuation and peer-leading capital returns.

Operational Efficiency

Devon's technologies and optimization plan is in process and should generate over $1 billion in annual FCF, as AI tools, agents, and models boost drilling, completions, and real-time production.

Shareholder Returns

Devon has one of the highest rates of shareholder return in the sector, paying out 70% of FCF as dividends and opportunistic buybacks.

Negative Factors

Commodity Prices

The market would still like to hear a Plan B if commodity prices fall from current levels.

Financial Results

There are mixed financial results expected for the second quarter with lower oil, gas, and NGL price realizations impacting estimates.

Market Expectations

The market wants to see meaningful capital expenditure reductions until macroeconomic uncertainties clear.

Devon Energy Business Overview & Revenue Model

Company Description

Devon Energy Corporation, an independent energy company, primarily engages in the exploration, development, and production of oil, natural gas, and natural gas liquids in the United States. It operates approximately 5,134 gross wells. Devon Energy Corporation was incorporated in 1971 and is headquartered in Oklahoma City, Oklahoma.

How the Company Makes Money

Devon Energy generates revenue primarily through the sale of crude oil, natural gas, and natural gas liquids (NGLs). The company earns money by extracting hydrocarbons from its various production sites and selling them in the open market. Key revenue streams include the sale of produced oil and gas, which are influenced by market prices, production volumes, and operational efficiencies. Additionally, Devon engages in hedging strategies to manage price volatility and protect its revenue. The company also benefits from partnerships and joint ventures with other energy firms, enabling shared resources and enhanced production capabilities. Factors such as geopolitical events, changes in regulatory policies, and market demand for energy commodities further impact Devon's earnings.

Devon Energy Financial Statement Overview

Summary

Devon Energy demonstrates solid profitability with strong gross and EBITDA margins. However, challenges include declining net profit margins and negative free cash flow, which could impact future liquidity. The balance sheet is stable with a reasonable debt-to-equity ratio, but the decrease in return on equity suggests a need for strategic improvements.

Income Statement

Devon Energy's income statement reflects a strong gross profit margin of 56.29% TTM, indicating efficient cost management. However, the net profit margin has decreased slightly to 17.30% TTM from 24.56% in 2023, suggesting some pressure on profitability. Revenue growth is modest at 1.28% TTM, following a decline in 2023, which could indicate market challenges. The EBIT margin is negative TTM, highlighting operational challenges, but the EBITDA margin remains robust at 47.41% TTM, showing strong core earnings potential.

Balance Sheet

The balance sheet shows a manageable debt-to-equity ratio of 0.60 TTM, reflecting a stable capital structure. Return on equity is healthy at 19.49% TTM, although it has decreased from 31.07% in 2023, indicating reduced profitability on equity. The equity ratio stands at 47.98% TTM, suggesting a balanced approach to financing with equity and debt.

Cash Flow

Cash flow analysis reveals a significant challenge with free cash flow, which is negative TTM, indicating potential liquidity issues. The operating cash flow to net income ratio is strong at 1.49 TTM, showing good cash generation relative to earnings. However, the negative free cash flow to net income ratio of -0.23 TTM highlights the need for improved cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	16.44B	15.57B	15.14B	19.83B	13.75B	4.35B
Gross Profit	9.25B	4.27B	5.20B	8.97B	5.21B	-252.00M
EBITDA	7.79B	7.43B	7.57B	10.38B	5.42B	-1.36B
Net Income	2.84B	2.89B	3.75B	6.01B	2.78B	-2.68B
Balance Sheet
Total Assets	31.39B	30.49B	24.49B	23.72B	21.02B	9.91B
Cash, Cash Equivalents and Short-Term Investments	1.76B	846.00M	875.00M	1.45B	2.10B	2.05B
Total Debt	8.99B	9.20B	6.45B	6.70B	6.73B	4.54B
Total Liabilities	16.10B	15.79B	12.27B	12.43B	11.63B	6.89B
Stockholders Equity	15.06B	14.50B	12.06B	11.17B	9.26B	2.88B
Cash Flow
Free Cash Flow	-1.19B	-853.00M	2.60B	3.40B	2.89B	193.00M
Operating Cash Flow	5.27B	6.60B	6.54B	8.53B	4.90B	1.35B
Investing Cash Flow	-6.19B	-7.33B	-3.94B	-5.12B	-1.57B	-646.00M
Financing Cash Flow	989.58M	706.00M	-3.18B	-4.21B	-3.29B	-306.00M

Devon Energy Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 36.10
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DVN, the sentiment is Positive. The current price of 36.1 is above the 20-day moving average (MA) of 33.91, above the 50-day MA of 33.41, and above the 200-day MA of 33.63, indicating a bullish trend. The MACD of 0.73 indicates Negative momentum. The RSI at 68.47 is Neutral, neither overbought nor oversold. The STOCH value of 91.65 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DVN.

Devon Energy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COP	79 Outperform	$123.61B	13.28	15.88%	3.15%	2.45%	-17.08%
DVN	77 Outperform	$22.92B	8.09	20.60%	3.16%	10.98%	-19.25%
FANG	74 Outperform	$43.06B	10.58	13.55%	2.62%	51.78%	-27.29%
EQT	72 Outperform	$32.35B	27.88	6.26%	1.22%	59.12%	12.12%
OXY	71 Outperform	$46.87B	27.97	6.98%	1.93%	-1.66%	-58.96%
CTRA	69 Neutral	$18.65B	11.71	11.42%	3.56%	16.56%	20.21%
Sector *	66 Neutral	$15.54B	7.32	3.17%	5.25%	4.26%	-62.31%

Devon Energy Corporate Events

Devon Energy Elects Board at Annual Meeting

At Devon Energy‘s Annual Meeting of Stockholders on June 4, 2025, all ten nominees for the Board were elected for a one-year term. Additionally, the appointment of KPMG LLP as the independent auditor for 2025 was ratified, and the advisory vote on executive compensation was approved. However, a stockholder proposal to change the holding requirement for calling a special meeting was not approved.