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Why Devon Energy (DVN) Dipped More Than Broader Market Today

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Devon Energy (DVN - Free Report) closed the latest trading day at $33.75, indicating a -1.03% change from the previous session's end. The stock's performance was behind the S&P 500's daily loss of 0.76%. Elsewhere, the Dow lost 0.28%, while the tech-heavy Nasdaq lost 1.2%.

Shares of the oil and gas exploration company have appreciated by 0.5% over the course of the past month, underperforming the Oils-Energy sector's gain of 4.11% and the S&P 500's gain of 2.71%.

The investment community will be closely monitoring the performance of Devon Energy in its forthcoming earnings report. The company is scheduled to release its earnings on February 18, 2025. It is anticipated that the company will report an EPS of $1, marking a 29.08% fall compared to the same quarter of the previous year. Meanwhile, the latest consensus estimate predicts the revenue to be $4.24 billion, indicating a 2.2% increase compared to the same quarter of the previous 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. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, there's been a 1.66% rise in the Zacks Consensus EPS estimate. Currently, Devon Energy is carrying a Zacks Rank of #3 (Hold).

With respect to valuation, Devon Energy is currently being traded at a Forward P/E ratio of 7.03. This represents a discount compared to its industry's average Forward P/E of 9.01.

One should further note that DVN currently holds a PEG ratio of 1.07. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Oil and Gas - Exploration and Production - United States industry currently had an average PEG ratio of 1.33 as of yesterday's close.

The Oil and Gas - Exploration and Production - United States industry is part of the Oils-Energy sector. With its current Zacks Industry Rank of 58, this industry ranks in the top 24% of all industries, numbering over 250.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. 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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