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Devon Energy (DVN) Gains As Market Dips: What You Should Know

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In the latest trading session, Devon Energy (DVN - Free Report) closed at $48.94, marking a +1.39% move from the previous day. This move outpaced the S&P 500's daily loss of 0.53%.

Heading into today, shares of the oil and gas exploration company had lost 1.71% over the past month, lagging the Oils-Energy sector's gain of 1.09% and the S&P 500's gain of 4.86% in that time.

Investors will be hoping for strength from Devon Energy as it approaches its next earnings release. On that day, Devon Energy is projected to report earnings of $1.39 per share, which would represent a year-over-year decline of 46.33%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.99 billion, down 29.07% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.14 per share and revenue of $16.11 billion. These totals would mark changes of -26.11% and -15.97%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Devon Energy. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. The Zacks Consensus EPS estimate has moved 4.27% lower within the past month. Devon Energy is currently a Zacks Rank #3 (Hold).

Digging into valuation, Devon Energy currently has a Forward P/E ratio of 7.86. For comparison, its industry has an average Forward P/E of 7.22, which means Devon Energy is trading at a premium to the group.

Also, we should mention that DVN has a PEG ratio of 0.15. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Oil and Gas - Exploration and Production - United States industry currently had an average PEG ratio of 0.37 as of yesterday's close.

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 217, putting it in the bottom 14% 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.

To follow DVN in the coming trading sessions, be sure to utilize Zacks.com.


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