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Can Devon (DVN) Keep Its Earnings Beat Streak Alive in Q4?

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Devon Energy Corporation (DVN - Free Report) is set to report fourth-quarter earnings on Feb 16, after market close. This oil and gas company delivered an earnings surprise of 66.7% in the last four quarters.

Let’s discuss the factors that are likely to get reflected in the upcoming quarterly results.

Factors at Play

Devon’s initiatives to lower operational and corporate costs are expected to have had a positive impact on fourth-quarter earnings. Strong oil production from the high-margin Delaware Basin region is expected to have boosted fourth-quarter oil production and earnings.

Courtesy of higher volumes, better capital efficiency and strong cost control, the company is expected to have registered strong free cash flow during the quarter.

Expectations

Devon expects fourth-quarter oil production in the range of 148,000-153,000 barrels of oil per day (Boe/d), taking into consideration strong activity in the Delaware Basin. The Zacks Consensus Estimate for fourth-quarter oil production is pegged at 150,000 Boe/d.

The Zacks Consensus Estimate for the bottom line for the fourth quarter is pegged at 5 cents per share, indicating an 84.8% decline from the prior-year reported figure.

What Our Quantitative Model Predicts

Our proven model predicts an earnings beat for Devon this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is the case here as you will see below. You can see the complete list of today’s Zacks #1 Rank stocks here.

Devon Energy Corporation Price and EPS Surprise

Devon Energy Corporation Price and EPS Surprise

Devon Energy Corporation price-eps-surprise | Devon Energy Corporation Quote

Earnings ESP: The company has an Earnings ESP of +11.11%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Devon currently carries a Zacks Rank #3.

Other Stocks to Consider

Investors can also consider the following players from the same industry that too have the right combination of elements to post an earnings beat in the to-be-reported quarter.

Pioneer Natural Resources (PXD - Free Report) is scheduled to release fourth-quarter 2020 numbers on Feb 17. It has an Earnings ESP of +3.65% and sports a Zacks Rank #1.

PDC Energy Inc. (PDCE - Free Report) is slated to release fourth-quarter 2020 numbers on Feb 25. It has an Earnings ESP of +10.77% and sports a Zacks Rank 1.

EOG Resources (EOG - Free Report) is set to release fourth-quarter earnings on Feb 26. It has an Earnings ESP of +4.83% and carries a Zacks Rank #2.

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