DEVON ENERGY CORP (DVN) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:DVN - US25179M1036 - Common Stock
38.64 USD
+0.66 (+1.74%)
38.85 USD
+0.21 (+0.54%)
DVN gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 207 industry peers in the Oil, Gas & Consumable Fuels industry. While DVN has a great profitability rating, there are some minor concerns on its financial health. DVN is valued quite cheap, while showing a decent growth score. This is a good combination!
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.
- DVN had positive earnings in 4 of the past 5 years.
- Each year in the past 5 years DVN had a positive operating cash flow.
1.2 Ratios
- DVN has a better Return On Assets (8.71%) than 86.96% of its industry peers.
- Looking at the Return On Equity, with a value of 17.71%, DVN belongs to the top of the industry, outperforming 85.02% of the companies in the same industry.
- DVN has a Return On Invested Capital of 11.84%. This is amongst the best in the industry. DVN outperforms 88.41% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for DVN is in line with the industry average of 21.94%.
- The 3 year average ROIC (20.63%) for DVN is well above the current ROIC(11.84%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.71% | ||
| ROE | 17.71% | ||
| ROIC | 11.84% |
ROA(3y)16.63%
ROA(5y)7.21%
ROE(3y)34.79%
ROE(5y)8.28%
ROIC(3y)20.63%
ROIC(5y)N/A
1.3 Margins
- DVN's Profit Margin of 15.56% is fine compared to the rest of the industry. DVN outperforms 66.67% of its industry peers.
- In the last couple of years the Profit Margin of DVN has declined.
- DVN has a Operating Margin of 22.88%. This is in the better half of the industry: DVN outperforms 60.39% of its industry peers.
- DVN's Operating Margin has improved in the last couple of years.
- Looking at the Gross Margin, with a value of 47.14%, DVN is in line with its industry, outperforming 56.52% of the companies in the same industry.
- DVN's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.88% | ||
| PM (TTM) | 15.56% | ||
| GM | 47.14% |
OM growth 3Y-0.73%
OM growth 5Y55.24%
PM growth 3Y-7.34%
PM growth 5YN/A
GM growth 3Y1.47%
GM growth 5Y-9.16%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so DVN is creating value.
- DVN has more shares outstanding than it did 1 year ago.
- DVN has more shares outstanding than it did 5 years ago.
- Compared to 1 year ago, DVN has a worse debt to assets ratio.
2.2 Solvency
- DVN has an Altman-Z score of 2.31. 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 Altman-Z score of 2.31. This is in the better half of the industry: DVN outperforms 70.05% of its industry peers.
- DVN has a debt to FCF ratio of 2.98. This is a good value and a sign of high solvency as DVN would need 2.98 years to pay back of all of its debts.
- The Debt to FCF ratio of DVN (2.98) is better than 75.85% of its industry peers.
- A Debt/Equity ratio of 0.48 indicates that DVN is not too dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 0.48, DVN is in line with its industry, outperforming 49.28% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.48 | ||
| Debt/FCF | 2.98 | ||
| Altman-Z | 2.31 |
ROIC/WACC1.47
WACC8.07%
2.3 Liquidity
- DVN has a Current Ratio of 0.96. This is a bad value and indicates that DVN is not financially healthy enough and could expect problems in meeting its short term obligations.
- DVN has a Current ratio (0.96) which is comparable to the rest of the industry.
- A Quick Ratio of 0.87 indicates that DVN may have some problems paying its short term obligations.
- DVN has a Quick ratio of 0.87. This is comparable to the rest of the industry: DVN outperforms 44.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.96 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
- DVN shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -16.34%.
- DVN shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 31.25% yearly.
- Looking at the last year, DVN shows a quite strong growth in Revenue. The Revenue has grown by 11.40% in the last year.
- DVN shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 20.71% yearly.
EPS 1Y (TTM)-16.34%
EPS 3Y11.12%
EPS 5Y31.25%
EPS Q2Q%-5.45%
Revenue 1Y (TTM)11.4%
Revenue growth 3Y9.3%
Revenue growth 5Y20.71%
Sales Q2Q%7.63%
3.2 Future
- Based on estimates for the next years, DVN will show a small growth in Earnings Per Share. The EPS will grow by 2.93% on average per year.
- The Revenue is expected to grow by 4.31% on average over the next years.
EPS Next Y-16.96%
EPS Next 2Y-8.31%
EPS Next 3Y2.77%
EPS Next 5Y2.93%
Revenue Next Year8.12%
Revenue Next 2Y1.9%
Revenue Next 3Y3%
Revenue Next 5Y4.31%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 9.09 indicates a reasonable valuation of DVN.
- 85.51% of the companies in the same industry are more expensive than DVN, based on the Price/Earnings ratio.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, DVN is valued rather cheaply.
- With a Price/Forward Earnings ratio of 9.52, the valuation of DVN can be described as very reasonable.
- 82.13% of the companies in the same industry are more expensive than DVN, based on the Price/Forward Earnings ratio.
- DVN is valuated cheaply when we compare the Price/Forward Earnings ratio to 24.26, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.09 | ||
| Fwd PE | 9.52 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, DVN is valued cheaper than 84.54% of the companies in the same industry.
- 84.54% of the companies in the same industry are more expensive than DVN, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.6 | ||
| EV/EBITDA | 4.04 |
4.3 Compensation for Growth
- DVN has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.29
EPS Next 2Y-8.31%
EPS Next 3Y2.77%
5. Dividend
5.1 Amount
- DVN has a Yearly Dividend Yield of 2.53%. Purely for dividend investing, there may be better candidates out there.
- DVN's Dividend Yield is comparable with the industry average which is at 3.74.
- DVN's Dividend Yield is a higher than the S&P500 average which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.53% |
5.2 History
- The dividend of DVN is nicely growing with an annual growth rate of 34.02%!
- DVN has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)34.02%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 22.55% of the earnings are spent on dividend by DVN. This is a low number and sustainable payout ratio.
- The dividend of DVN is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP22.55%
EPS Next 2Y-8.31%
EPS Next 3Y2.77%
DEVON ENERGY CORP / DVN FAQ
What is the fundamental rating for DVN stock?
ChartMill assigns a fundamental rating of 6 / 10 to DVN.
What is the valuation status of DEVON ENERGY CORP (DVN) stock?
ChartMill assigns a valuation rating of 7 / 10 to DEVON ENERGY CORP (DVN). This can be considered as Undervalued.
Can you provide the profitability details for DEVON ENERGY CORP?
DEVON ENERGY CORP (DVN) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for DVN stock?
The Price/Earnings (PE) ratio for DEVON ENERGY CORP (DVN) is 9.09 and the Price/Book (PB) ratio is 1.58.
What is the expected EPS growth for DEVON ENERGY CORP (DVN) stock?
The Earnings per Share (EPS) of DEVON ENERGY CORP (DVN) is expected to decline by -16.96% in the next year.