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Devon Energy (DVN) Up 16.5% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Devon Energy (DVN - Free Report) . Shares have added about 16.5% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Devon Energy due for a pullback? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for Devon Energy Corporation before we dive into how investors and analysts have reacted as of late.
Devon Q2 Earnings Surpass Estimates on Strong Oil Output and Pricing
Devon Energy Corporation reported second-quarter 2026 adjusted earnings of $1.57 per share, beating the Zacks Consensus Estimate of $1.30 by 20.77%.
GAAP earnings were $2.03 per share, up 44% from $1.41 a year ago.
Total Revenues
Revenues of $7.41 billion surpassed the consensus estimate of $6.29 billion by 17.81% and increased 73.1% year over year. Strong oil pricing and contributions from the Coterra Energy merger supported the results.
Oil, gas and natural gas liquids sales totaled $5.11 billion compared with $2.71 billion in the year-ago quarter. Marketing and midstream revenues increased to $1.90 billion from $1.34 billion.
Oil, gas and NGL derivatives generated revenues of $414 million compared with $236 million a year earlier. The latest figure included $530 million of positive derivative valuation changes, partly offset by $116 million of cash settlement losses.
Devon’s Production Performance
Total production averaged 1,359 thousand barrels of oil equivalent per day (MBoe/d), up 61.6% year over year from 841,000 Boe/d. Devon completed its merger with Coterra on May 7, meaning the quarterly figures included combined operations for part of the period. The production level was 1.6% higher than the midpoint of management’s guidance.
Oil production rose 30% year over year to 503,000 barrels per day. NGL output climbed 41.4% to 314,000 barrels per day, while natural gas production increased to 3,252 million cubic feet per day from 1,388 million cubic feet. Better-than-expected well performance in the Delaware Basin supported oil and gas volumes.
DVN Benefits From Strong Oil Realizations
Realized oil prices, including cash settlements, were up 39.9% year over year to $88.09 per barrel from $62.97 in the prior-year quarter. Excluding hedges, oil realizations were $95.10 per barrel.
Realized NGL prices increased to $22.70 per barrel from $17.82. However, realized natural gas prices, including cash settlements, declined to $1.05 per thousand cubic feet from $1.56. Regional Waha pricing was pressured by infrastructure constraints in the Delaware Basin.
Devon Keeps Capital Spending Disciplined
Capital expenditures were $1.27 billion, 2% below the midpoint of management’s guidance. The company placed 120 net operated wells online during the quarter, with an average lateral length of 10,800 feet.
The Permian accounted for $731 million of capital spending, followed by $196 million in the Rockies. Eagle Ford, Anadarko and Marcellus expenditures were $97 million, $129 million and $70 million, respectively. Devon acquired 16,300 net Delaware Basin acres for $2.6 billion, adding approximately 400 top-tier locations.
DVN Generates Robust Free Cash Flow
Net cash from operating activities was $3.67 billion compared with $1.55 billion a year ago. Adjusted operating cash flow was $2.9 billion, while adjusted free cash flow totaled roughly $1.7 billion, excluding after-tax restructuring costs.
Devon returned $1.06 billion through dividends, share repurchases and debt retirement. It repurchased 4.3 million shares for $197 million and paid $366 million in dividends. The quarterly fixed dividend was raised 33% to 32 cents per share.
Devon Provides Guidance
For the third quarter of 2026, total production is expected between 1,660 MBoe/d and 1,690 MBoe/d. Oil production is projected in the range of 550,000-560,000 barrels per day. Third-quarter capital expenditures are anticipated between $1.4 billion and $1.5 billion.
Devon maintained its full-year guidance, calling for total production of 1,364 MBoe/d to 1,398 MBoe/d and capital spending of $4.8-$5 billion. 2026 Oil production is expected to be in the range of 495,000-505,000 barrels per day. Natural gas production for 2026 is expected to be in the range of 3,300-3,400 million cubic feet per day.
Management remains on track to achieve at least $1 billion in annual pre-tax merger synergies on a run-rate basis by the end of 2027.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in estimates revision.
The consensus estimate has shifted 9.24% due to these changes.
VGM Scores
Currently, Devon Energy has a great Growth Score of A, a score with the same score on the momentum front. Charting a somewhat similar path, the stock has a score of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Devon Energy has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Devon Energy belongs to the Zacks Oil and Gas - Exploration and Production - United States industry. Another stock from the same industry, Range Resources (RRC - Free Report) , has gained 11.4% over the past month. More than a month has passed since the company reported results for the quarter ended June 2026.
Range Resources reported revenues of $795.3 million in the last reported quarter, representing a year-over-year change of +8.5%. EPS of $0.79 for the same period compares with $0.66 a year ago.
Range Resources is expected to post earnings of $0.67 per share for the current quarter, representing a year-over-year change of +17.5%. Over the last 30 days, the Zacks Consensus Estimate has changed +5.6%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Range Resources. Also, the stock has a VGM Score of B.
View the Zacks #1 Rank List
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Devon Energy (DVN) Up 16.5% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Devon Energy (DVN - Free Report) . Shares have added about 16.5% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Devon Energy due for a pullback? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for Devon Energy Corporation before we dive into how investors and analysts have reacted as of late.
Devon Q2 Earnings Surpass Estimates on Strong Oil Output and Pricing
Devon Energy Corporation reported second-quarter 2026 adjusted earnings of $1.57 per share, beating the Zacks Consensus Estimate of $1.30 by 20.77%.
GAAP earnings were $2.03 per share, up 44% from $1.41 a year ago.
Total Revenues
Revenues of $7.41 billion surpassed the consensus estimate of $6.29 billion by 17.81% and increased 73.1% year over year. Strong oil pricing and contributions from the Coterra Energy merger supported the results.
Oil, gas and natural gas liquids sales totaled $5.11 billion compared with $2.71 billion in the year-ago quarter. Marketing and midstream revenues increased to $1.90 billion from $1.34 billion.
Oil, gas and NGL derivatives generated revenues of $414 million compared with $236 million a year earlier. The latest figure included $530 million of positive derivative valuation changes, partly offset by $116 million of cash settlement losses.
Devon’s Production Performance
Total production averaged 1,359 thousand barrels of oil equivalent per day (MBoe/d), up 61.6% year over year from 841,000 Boe/d. Devon completed its merger with Coterra on May 7, meaning the quarterly figures included combined operations for part of the period. The production level was 1.6% higher than the midpoint of management’s guidance.
Oil production rose 30% year over year to 503,000 barrels per day. NGL output climbed 41.4% to 314,000 barrels per day, while natural gas production increased to 3,252 million cubic feet per day from 1,388 million cubic feet. Better-than-expected well performance in the Delaware Basin supported oil and gas volumes.
DVN Benefits From Strong Oil Realizations
Realized oil prices, including cash settlements, were up 39.9% year over year to $88.09 per barrel from $62.97 in the prior-year quarter. Excluding hedges, oil realizations were $95.10 per barrel.
Realized NGL prices increased to $22.70 per barrel from $17.82. However, realized natural gas prices, including cash settlements, declined to $1.05 per thousand cubic feet from $1.56. Regional Waha pricing was pressured by infrastructure constraints in the Delaware Basin.
Devon Keeps Capital Spending Disciplined
Capital expenditures were $1.27 billion, 2% below the midpoint of management’s guidance. The company placed 120 net operated wells online during the quarter, with an average lateral length of 10,800 feet.
The Permian accounted for $731 million of capital spending, followed by $196 million in the Rockies. Eagle Ford, Anadarko and Marcellus expenditures were $97 million, $129 million and $70 million, respectively. Devon acquired 16,300 net Delaware Basin acres for $2.6 billion, adding approximately 400 top-tier locations.
DVN Generates Robust Free Cash Flow
Net cash from operating activities was $3.67 billion compared with $1.55 billion a year ago. Adjusted operating cash flow was $2.9 billion, while adjusted free cash flow totaled roughly $1.7 billion, excluding after-tax restructuring costs.
Devon returned $1.06 billion through dividends, share repurchases and debt retirement. It repurchased 4.3 million shares for $197 million and paid $366 million in dividends. The quarterly fixed dividend was raised 33% to 32 cents per share.
Devon Provides Guidance
For the third quarter of 2026, total production is expected between 1,660 MBoe/d and 1,690 MBoe/d. Oil production is projected in the range of 550,000-560,000 barrels per day. Third-quarter capital expenditures are anticipated between $1.4 billion and $1.5 billion.
Devon maintained its full-year guidance, calling for total production of 1,364 MBoe/d to 1,398 MBoe/d and capital spending of $4.8-$5 billion. 2026 Oil production is expected to be in the range of 495,000-505,000 barrels per day. Natural gas production for 2026 is expected to be in the range of 3,300-3,400 million cubic feet per day.
Management remains on track to achieve at least $1 billion in annual pre-tax merger synergies on a run-rate basis by the end of 2027.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in estimates revision.
The consensus estimate has shifted 9.24% due to these changes.
VGM Scores
Currently, Devon Energy has a great Growth Score of A, a score with the same score on the momentum front. Charting a somewhat similar path, the stock has a score of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Devon Energy has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Devon Energy belongs to the Zacks Oil and Gas - Exploration and Production - United States industry. Another stock from the same industry, Range Resources (RRC - Free Report) , has gained 11.4% over the past month. More than a month has passed since the company reported results for the quarter ended June 2026.
Range Resources reported revenues of $795.3 million in the last reported quarter, representing a year-over-year change of +8.5%. EPS of $0.79 for the same period compares with $0.66 a year ago.
Range Resources is expected to post earnings of $0.67 per share for the current quarter, representing a year-over-year change of +17.5%. Over the last 30 days, the Zacks Consensus Estimate has changed +5.6%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Range Resources. Also, the stock has a VGM Score of B.