DEVON ENERGY CORP (DVN) Stock Fundamental Analysis
NYSE:DVN - New York Stock Exchange, Inc. - US25179M1036 - Common Stock - Currency: USD
DVN gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 211 industry peers in the Oil, Gas & Consumable Fuels industry. There are concerns on the financial health of DVN while its profitability can be described as average. DVN has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year DVN was profitable.
In the past year DVN had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: DVN reported negative net income in multiple years.
Of the past 5 years DVN 4 years had a positive operating cash flow.
1.2 Ratios
DVN has a Return On Assets of 11.25%. This is amongst the best in the industry. DVN outperforms 81.86% of its industry peers.
Looking at the Return On Equity, with a value of 23.84%, DVN is in the better half of the industry, outperforming 79.90% of the companies in the same industry.
DVN has a better Return On Invested Capital (13.78%) than 81.37% of its industry peers.
The Average Return On Invested Capital over the past 3 years for DVN is significantly below the industry average of 28.75%.
The 3 year average ROIC (21.19%) for DVN is well above the current ROIC(13.78%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.25% | ||
| ROE | 23.84% | ||
| ROIC | 13.78% |
ROA(3y)17.88%
ROA(5y)4.79%
ROE(3y)38.16%
ROE(5y)3.06%
ROIC(3y)21.19%
ROIC(5y)N/A
1.3 Margins
With a decent Profit Margin value of 21.71%, DVN is doing good in the industry, outperforming 70.10% of the companies in the same industry.
In the last couple of years the Profit Margin of DVN has declined.
The Operating Margin of DVN (30.15%) is better than 63.73% of its industry peers.
DVN's Operating Margin has improved in the last couple of years.
DVN has a Gross Margin (51.89%) which is comparable to the rest of the industry.
DVN's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.15% | ||
| PM (TTM) | 21.71% | ||
| GM | 51.89% |
OM growth 3YN/A
OM growth 5Y14.05%
PM growth 3YN/A
PM growth 5Y-6.49%
GM growth 3Y-12.21%
GM growth 5Y-9.82%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), DVN is creating value.
DVN has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
DVN has an Altman-Z score of 2.35. This is not the best score and indicates that DVN is in the grey zone with still only limited risk for bankruptcy at the moment.
DVN has a better Altman-Z score (2.35) than 68.63% of its industry peers.
A Debt/Equity ratio of 0.64 indicates that DVN is somewhat dependend on debt financing.
DVN's Debt to Equity ratio of 0.64 is on the low side compared to the rest of the industry. DVN is outperformed by 62.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.64 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.35 |
ROIC/WACC1.61
WACC8.54%
2.3 Liquidity
A Current Ratio of 1.11 indicates that DVN should not have too much problems paying its short term obligations.
The Current ratio of DVN (1.11) is comparable to the rest of the industry.
DVN has a Quick Ratio of 1.01. This is a normal value and indicates that DVN is financially healthy and should not expect problems in meeting its short term obligations.
With a Quick ratio value of 1.01, DVN perfoms like the industry average, outperforming 47.55% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 1.01 |
3. Growth
3.1 Past
The earnings per share for DVN have decreased strongly by -15.26% in the last year.
Measured over the past years, DVN shows a very strong growth in Earnings Per Share. The EPS has been growing by 31.25% on average per year.
EPS 1Y (TTM)-15.26%
EPS 3Y11.12%
EPS 5Y31.25%
EPS Q2Q%-17.73%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%6.22%
3.2 Future
The Earnings Per Share is expected to grow by 7.92% on average over the next years.
The Revenue is expected to grow by 5.49% on average over the next years.
EPS Next Y0.8%
EPS Next 2Y5.2%
EPS Next 3Y2.06%
EPS Next 5Y7.92%
Revenue Next Year8.37%
Revenue Next 2Y5.49%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
DVN is valuated cheaply with a Price/Earnings ratio of 7.76.
75.00% of the companies in the same industry are more expensive than DVN, based on the Price/Earnings ratio.
DVN's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 30.30.
A Price/Forward Earnings ratio of 7.70 indicates a rather cheap valuation of DVN.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DVN indicates a somewhat cheap valuation: DVN is cheaper than 75.49% of the companies listed in the same industry.
DVN is valuated cheaply when we compare the Price/Forward Earnings ratio to 23.06, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.76 | ||
| Fwd PE | 7.7 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DVN indicates a somewhat cheap valuation: DVN is cheaper than 74.02% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 4.42 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
DVN has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)9.73
PEG (5Y)0.25
EPS Next 2Y5.2%
EPS Next 3Y2.06%
5. Dividend
5.1 Amount
DVN has a Yearly Dividend Yield of 2.74%.
DVN's Dividend Yield is comparable with the industry average which is at 6.74.
Compared to an average S&P500 Dividend Yield of 2.29, DVN has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.74% |
5.2 History
The dividend of DVN is nicely growing with an annual growth rate of 56.62%!
DVN has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)56.62%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
37.66% of the earnings are spent on dividend by DVN. This is a low number and sustainable payout ratio.
DVN's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP37.66%
EPS Next 2Y5.2%
EPS Next 3Y2.06%
37.49
-1.06 (-2.75%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners71.05%
Inst Owner Change4.08%
Ins Owners0.72%
Ins Owner Change0.45%
Market Cap24.63B
Analysts78.24
Price Target50.48 (34.65%)
Short Float %3.02%
Short Ratio1.84
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.74% |
Yearly Dividend2.88
Dividend Growth(5Y)56.62%
DP37.66%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)5.24%
Min EPS beat(2)-0.04%
Max EPS beat(2)10.51%
EPS beat(4)2
Avg EPS beat(4)3.34%
Min EPS beat(4)-0.66%
Max EPS beat(4)10.51%
EPS beat(8)4
Avg EPS beat(8)1.96%
EPS beat(12)8
Avg EPS beat(12)3.55%
EPS beat(16)11
Avg EPS beat(16)0.37%
Revenue beat(2)1
Avg Revenue beat(2)3.06%
Min Revenue beat(2)-0.38%
Max Revenue beat(2)6.51%
Revenue beat(4)3
Avg Revenue beat(4)3.68%
Min Revenue beat(4)-0.38%
Max Revenue beat(4)6.51%
Revenue beat(8)5
Avg Revenue beat(8)0.33%
Revenue beat(12)8
Avg Revenue beat(12)3.03%
Revenue beat(16)11
Avg Revenue beat(16)2.07%
PT rev (1m)-1.65%
PT rev (3m)-5.55%
EPS NQ rev (1m)3.92%
EPS NQ rev (3m)-9.19%
EPS NY rev (1m)0.16%
EPS NY rev (3m)-2.76%
Revenue NQ rev (1m)1.12%
Revenue NQ rev (3m)0.31%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.36%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.76 | ||
| Fwd PE | 7.7 | ||
| P/S | 1.57 | ||
| P/FCF | N/A | ||
| P/OCF | 3.69 | ||
| P/B | 1.72 | ||
| P/tB | 1.82 | ||
| EV/EBITDA | 4.42 |
EPS(TTM)4.83
EY12.88%
EPS(NY)4.87
Fwd EY12.99%
FCF(TTM)-1
FCFYN/A
OCF(TTM)10.16
OCFY27.1%
SpS23.87
BVpS21.73
TBVpS20.59
PEG (NY)9.73
PEG (5Y)0.25
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.25% | ||
| ROE | 23.84% | ||
| ROCE | 17.28% | ||
| ROIC | 13.78% | ||
| ROICexc | 14.13% | ||
| ROICexgc | 14.54% | ||
| OM | 30.15% | ||
| PM (TTM) | 21.71% | ||
| GM | 51.89% | ||
| FCFM | N/A |
ROA(3y)17.88%
ROA(5y)4.79%
ROE(3y)38.16%
ROE(5y)3.06%
ROIC(3y)21.19%
ROIC(5y)N/A
ROICexc(3y)22.92%
ROICexc(5y)N/A
ROICexgc(3y)23.89%
ROICexgc(5y)N/A
ROCE(3y)26.57%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y18.52%
ROICexc growth 3YN/A
ROICexc growth 5Y19.02%
OM growth 3YN/A
OM growth 5Y14.05%
PM growth 3YN/A
PM growth 5Y-6.49%
GM growth 3Y-12.21%
GM growth 5Y-9.82%
F-Score5
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.64 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 1.2 | ||
| Cap/Depr | 249.86% | ||
| Cap/Sales | 46.75% | ||
| Interest Coverage | 12.54 | ||
| Cash Conversion | 87.09% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.11 | ||
| Quick Ratio | 1.01 | ||
| Altman-Z | 2.35 |
F-Score5
WACC8.54%
ROIC/WACC1.61
Cap/Depr(3y)159.36%
Cap/Depr(5y)139.41%
Cap/Sales(3y)23.02%
Cap/Sales(5y)24.86%
Profit Quality(3y)76.79%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-15.26%
EPS 3Y11.12%
EPS 5Y31.25%
EPS Q2Q%-17.73%
EPS Next Y0.8%
EPS Next 2Y5.2%
EPS Next 3Y2.06%
EPS Next 5Y7.92%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%6.22%
Revenue Next Year8.37%
Revenue Next 2Y5.49%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-25.01%
EBIT growth 3YN/A
EBIT growth 5Y27.05%
EBIT Next Year58.65%
EBIT Next 3Y20.42%
EBIT Next 5Y8.33%
FCF growth 1Y-119.38%
FCF growth 3Y137.85%
FCF growth 5Y37.26%
OCF growth 1Y-18.76%
OCF growth 3Y69.07%
OCF growth 5Y19.33%