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Devon Energy (DVN)
NYSE:DVN
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Devon Energy
(NYSE:DVN)
Select Model
Select Model
Rating:74Outperform
Price Target:
$38.00
â–²(6.26% Upside)
Devon Energy's overall stock score reflects strong earnings call performance and attractive valuation, offset by financial performance challenges and mixed technical indicators. The company's strategic initiatives and operational efficiencies are significant positives, but liquidity concerns and market volatility remain risks.
Positive Factors
Operational Efficiencies
Improved drilling and completion costs indicate enhanced operational efficiency, which can lead to sustained profitability and competitive advantage.
Shareholder Returns
High returns to shareholders through dividends and buybacks demonstrate strong cash generation and commitment to shareholder value.
Strategic Midstream Transactions
Strategic transactions enhance financial position and operational support, potentially leading to improved long-term growth prospects.
Negative Factors
Free Cash Flow Challenges
Negative free cash flow indicates potential liquidity issues, which could limit financial flexibility and investment capacity.
Net Profit Margin Decline
Declining net profit margins suggest pressure on profitability, which may affect long-term financial performance and shareholder returns.
Operational Challenges in Eagle Ford
Increased operational challenges in Eagle Ford could lead to higher costs and impact production efficiency, affecting overall profitability.
Devon Energy (DVN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.41B
Dividend Yield2.63%
Average Volume (3M)6.77M
Price to Earnings (P/E)7.6
Beta (1Y)0.57
Revenue Growth10.98%
EPS Growth-19.25%
CountryUS
Employees2,300
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)0.84
Shares Outstanding634,800,000
10 Day Avg. Volume8,097,636
30 Day Avg. Volume6,765,832
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.30
Enterprise Value/Revenue1.66
Enterprise Value/Gross Profit6.43
Enterprise Value/Ebitda3.55
Forecast
1Y Price Target
$43.71Price Target Upside22.23% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering19
Devon Energy Business Overview & Revenue Model
Company DescriptionDevon 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 MoneyDevon 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 Key Performance Indicators (KPIs)
Any
Total Oil Production
Measures the total volume of oil extracted, reflecting Devon Energy's operational scale and its ability to capitalize on market demand.
Measures the total volume of oil extracted, reflecting Devon Energy's operational scale and its ability to capitalize on market demand.
Data provided by:
Main Street Data
Main Street DataDevon Energy Earnings Call Summary
Earnings Call Date:Aug 05, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Positive
Devon Energy's earnings call reflected significant operational achievements and financial performance, with strong production and capital efficiency driving shareholder returns. However, challenges with non-oil realizations and operational complexities in the Eagle Ford were noted.Q2-2025 Updates
Positive Updates
Production Outperformance and Capital Reduction
Devon exceeded the top end of production guidance and reduced capital spending by 7% below expectations, generating Q2 free cash flow of $589 million.
Operational Efficiencies in Key Basins
In the Delaware Basin, drilling costs improved by 12% and completion costs by 15% year-over-year. Similar momentum was seen in the Williston and Eagle Ford basins, with significant cost savings per well.
Strong Financial Performance and Shareholder Returns
Core earnings were $0.84 per share, EBITDAX was $1.8 billion, and operating cash flow was $1.5 billion. Approximately 70% of the free cash flow was returned to shareholders through dividends and share repurchases.
Strategic Midstream Transactions
Devon completed the sale of the Matterhorn Pipeline and acquired the remaining noncontrolling interest in Cotton Draw Midstream, enhancing financial position and operational support.
Tax Legislation Benefits
New federal legislation is expected to reduce Devon's current tax rate to 10% for 2025, adding nearly $300 million in projected cash flow for the year.
Negative Updates
Challenges with Non-Oil Realizations
NGLs and local gas prices have continued to be a headwind, affecting non-oil realizations despite strong oil performance.
Operational Challenges in the Eagle Ford
Post-JV dissolution, Devon faces higher operational challenges in the Eagle Ford, particularly in areas requiring additional casing strings.
Company Guidance
During Devon Energy's Second Quarter 2025 conference call, the company provided a comprehensive update on its financial performance and strategic initiatives. Devon delivered core earnings of $0.84 per share and generated EBITDAX of $1.8 billion, with operating cash flow reaching $1.5 billion. The company exceeded the top end of its production guidance, driven by strong performance in the Delaware Basin, and achieved capital spending 7% below guidance. Devon returned approximately 70% of its $589 million in free cash flow to shareholders via dividends and share repurchases, maintaining its commitment to delivering long-term shareholder value. The company also highlighted its progress toward a $1 billion annual free cash flow optimization plan, achieving 40% of this target within four months. Furthermore, Devon reduced its 2025 capital guidance by 10% while continuously leveraging technology to drive operational efficiencies. The company completed significant midstream transactions, including the sale of the Matterhorn Pipeline and the acquisition of the remaining interest in Cotton Draw Midstream, which are expected to bolster its financial position and support future growth.Devon Energy Financial Statement Overview
Summary
Devon Energy shows strong gross and EBITDA margins, indicating efficient operations. However, challenges such as declining net profit margins and negative free cash flow 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.75
Positive
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.70
Positive
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.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 16.75B | 15.57B | 15.14B | 19.83B | 13.75B | 4.35B |
| Gross Profit | 4.32B | 4.27B | 5.20B | 8.97B | 5.21B | -252.00M |
| EBITDA | 7.81B | 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
Positive
35.76
Price Trends
33.90
Positive
33.10
Positive
33.19
Positive
Market Momentum
0.24
Positive
58.10
Neutral
68.11
Neutral
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 35.76 is above the 20-day moving average (MA) of 34.89, above the 50-day MA of 33.90, and above the 200-day MA of 33.19, indicating a bullish trend. The MACD of 0.24 indicates Positive momentum. The RSI at 58.10 is Neutral, neither overbought nor oversold. The STOCH value of 68.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DVN.
Devon Energy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | 119.44B | 12.83 | 13.96% | 3.22% | 2.45% | -17.08% | |
77 Outperform | 41.86B | 10.28 | 9.87% | 2.68% | 51.78% | -27.29% | |
74 Outperform | $21.41B | 7.55 | 20.60% | 2.63% | 10.98% | -19.25% | |
72 Outperform | 33.13B | 28.55 | 5.34% | 1.17% | 59.12% | 12.12% | |
72 Outperform | 18.12B | 11.38 | 10.83% | 3.67% | 16.56% | 20.21% | |
71 Outperform | 46.16B | 27.55 | 8.91% | 2.00% | -1.66% | -58.96% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% |
* Energy Sector Average
Performance Comparison
DVN
Devon Energy
35.76
-2.14
-5.65%
CTRA
Coterra Energy
23.70
0.76
3.31%
COP
Conocophillips
96.81
-4.64
-4.57%
EQT
EQT
53.93
17.88
49.60%
OXY
Occidental Petroleum
46.99
-3.00
-6.00%
FANG
Diamondback
145.79
-20.45
-12.30%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.