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Devon Energy (DVN) Outpaces Stock Market Gains: What You Should Know

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Devon Energy (DVN - Free Report) closed the most recent trading day at $49.60, moving +1.33% from the previous trading session. This change outpaced the S&P 500's 1.22% gain on the day. At the same time, the Dow added 1.26%, and the tech-heavy Nasdaq gained 4.63%.

Heading into today, shares of the oil and gas exploration company had gained 2.6% over the past month, outpacing the Oils-Energy sector's gain of 2.49% and lagging the S&P 500's gain of 6.22% in that time.

Wall Street will be looking for positivity from Devon Energy as it approaches its next earnings report date. The company is expected to report EPS of $1.39, down 46.33% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.99 billion, down 29.07% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $6.14 per share and revenue of $16.11 billion, which would represent changes of -26.11% and -15.97%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Devon Energy. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 4.59% lower. Devon Energy is currently a Zacks Rank #3 (Hold).

Looking at its valuation, Devon Energy is holding a Forward P/E ratio of 7.97. For comparison, its industry has an average Forward P/E of 7.2, which means Devon Energy is trading at a premium to the group.

Investors should also note that DVN has a PEG ratio of 0.16 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Oil and Gas - Exploration and Production - United States was holding an average PEG ratio of 0.37 at yesterday's closing price.

The Oil and Gas - Exploration and Production - United States industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 221, putting it in the bottom 13% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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