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Devon Energy Corp DVN

Morningstar Rating
$48.12 +0.35 (0.73%)
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Company Report

Devon’s Multibasin Presence and Low-Cost Operations Should Translate to Attractive Free Cash Flow

In 2018, Devon embarked on a series of shrewd capital allocation moves that saw it sell its Enlink Midstream interest, divest its Canadian heavy oil and Barnett Shale interests, and merge with WPX. These astute steps allowed Devon to recycle cash by shedding interests that were either noncore or higher on the cost curve. Recycled cash allowed Devon to meaningfully pivot toward the Delaware and enjoy newfound exposure in the Bakken. Previously, both Canadian Heavy Oil and Barnett Shale made up 40%-50% of its production.

Price vs Fair Value

DVN is trading at a 511% premium.
Price
$47.77
Fair Value
$86.00
Uncertainty
Medium
1-Star Price
$93.70
5-Star Price
$85.50
Economic Moat
Nlbtm
Capital Allocation
Hlzythcr

Bulls Say, Bears Say

Bulls

Devon enjoys ideally located acreage in core portions of the basins it operates in. Attractive acreage translates to above-average well performance and peer-leading supply costs.

Bears

After incorporating sunk costs from leaseholds, acquisitions, exploration, and infrastructure, Devon's capital base inflates to a level that could threaten excess returns.

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News

Trading Information

Previous Close Price
$47.77
Day Range
$47.8248.12
52-Week Range
$40.4855.09
Bid/Ask
$48.11 / $48.13
Market Cap
$30.32 Bil
Volume/Avg
3,791 / 6.5 Mil

Key Statistics

Price/Earnings (Normalized)
8.85
Price/Sales
2.03
Dividend Yield (Trailing)
4.29%
Dividend Yield (Forward)
4.29%
Total Yield
6.50%

Company Profile

Devon Energy is an oil and gas producer with acreage in several top US shale plays. While roughly two thirds of its production comes from the Permian Basin, it also holds a meaningful presence in the Anadarko, Eagle Ford, and Bakken basins. At the end of 2023, Devon reported net proved reserves of 1.8 billion barrels of oil equivalent. Net production averaged roughly 658,000 barrels of oil equivalent per day in 2023 at a ratio of 73% oil and natural gas liquids and 27% natural gas.
Sector
Energy
Industry
Oil & Gas E&P
Stock Style Box
Mid Value
Total Number of Employees
1,900

Competitors

Valuation

Metric
DVN
EOG
FANG
Price/Earnings (Normalized)
8.8510.6311.04
Price/Book Value
2.492.542.16
Price/Sales
2.033.144.24
Price/Cash Flow
4.636.396.42
Price/Earnings
DVN
EOG
FANG

Financial Strength

Metric
DVN
EOG
FANG
Quick Ratio
0.861.870.87
Current Ratio
1.042.320.92
Interest Coverage
12.3462.8525.71
Quick Ratio
DVN
EOG
FANG

Profitability

Metric
DVN
EOG
FANG
Return on Assets (Normalized)
14.30%16.00%11.70%
Return on Equity (Normalized)
29.77%25.23%20.54%
Return on Invested Capital (Normalized)
20.25%21.58%14.66%
Return on Assets
DVN
EOG
FANG
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