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Why Is Devon Energy (DVN) Down 2.7% Since Last Earnings Report?
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It has been about a month since the last earnings report for Devon Energy (DVN - Free Report) . Shares have lost about 2.7% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Devon Energy due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Devon Energy Q3 Earnings & Revenues Beat Estimates
Devon Energy Corp. reported third-quarter 2021 adjusted earnings of $1.08 per share, beating the Zacks Consensus Estimate of 92 cents by 17.4%. In the year-ago quarter, the company incurred a loss of 4 cents per share.
GAAP earnings for the third quarter were $1.24 compared with 38 cents per share in the year-ago period.
Revenues
Total revenues of $3,466 million surpassed the Zacks Consensus Estimate by 8.8%. The top line also improved 43.4% from the year-ago figure.
Production
Total net production for third-quarter 2021 touched 608,000 barrels of oil equivalent per day (Boe/d), up 86.5% year over year. Third-quarter production was better than the guided range of 566,000-594,000 Boe/d.
Oil production averaged 303,000 barrels per day (Bbl/d), which increased 107.5% on a year-over-year basis, primarily due to strong contributions from Delaware and Williston Basin assets. Natural gas liquids production was also up 78.3% year over year to 148,000 BBl/d.
Realized Prices
Realized oil prices for the quarter were $57.59 per barrel, up 50.7% from $38.21 in the year-ago period. Realized prices for natural gas liquids were up 155.4% to $30.8 per barrel from $12.06 in the prior-year quarter.
Realized gas prices were up 79.9% to $2.77 per thousand cubic feet from $1.54 in the prior-year quarter.
Total oil equivalent realized prices — including cash settlements — were $40.48 per Boe, up 76.5% year over year.
Other Highlights
Total production expenses for the third quarter were $555 million, increasing 104.8% year over year.
The board of directors authorized a $1-billion share buyback, representing 4% of Devon’s market capitalization. Free cash flow generation was $1.1 billion, an eight-fold increase from the fourth-quarter 2020 level.
Financing costs for the reported quarter were $86 million, up 30.3% from $66 million in the year-ago period.
Financial Highlights
As of Sep 30, 2021, the company had cash and cash equivalents including restricted cash of $2,321 million, up from $2,237 million on Dec 31, 2020. It exited the third quarter with $2.3 billion of liquidity and no debt maturities till 2023.
As of Sep 30, 2021, long-term debt amounted to $6,492 million, up from $4,298 million on Dec 31, 2020.
Devon Energy’s net cash from operating activities for third-quarter 2021 was $1,598 million compared with $427 million in the year-ago period.
Guidance
It expects total production for the fourth quarter in the range of 583,000-601,000 Boe/d. Fourth-quarter expenditure is projected in the range of $465-$535 million.
The company’s 2022 total production is expected in the range of 570,000-600,000 Boe/d and upstream capital investment within $1.9-$2.2 billion.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 10.39% due to these changes.
VGM Scores
Currently, Devon Energy has a great Growth Score of A, a grade with the same score on the momentum front. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. 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. It comes with little surprise Devon Energy has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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Why Is Devon Energy (DVN) Down 2.7% Since Last Earnings Report?
It has been about a month since the last earnings report for Devon Energy (DVN - Free Report) . Shares have lost about 2.7% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Devon Energy due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Devon Energy Q3 Earnings & Revenues Beat Estimates
Devon Energy Corp. reported third-quarter 2021 adjusted earnings of $1.08 per share, beating the Zacks Consensus Estimate of 92 cents by 17.4%. In the year-ago quarter, the company incurred a loss of 4 cents per share.
GAAP earnings for the third quarter were $1.24 compared with 38 cents per share in the year-ago period.
Revenues
Total revenues of $3,466 million surpassed the Zacks Consensus Estimate by 8.8%. The top line also improved 43.4% from the year-ago figure.
Production
Total net production for third-quarter 2021 touched 608,000 barrels of oil equivalent per day (Boe/d), up 86.5% year over year. Third-quarter production was better than the guided range of 566,000-594,000 Boe/d.
Oil production averaged 303,000 barrels per day (Bbl/d), which increased 107.5% on a year-over-year basis, primarily due to strong contributions from Delaware and Williston Basin assets. Natural gas liquids production was also up 78.3% year over year to 148,000 BBl/d.
Realized Prices
Realized oil prices for the quarter were $57.59 per barrel, up 50.7% from $38.21 in the year-ago period. Realized prices for natural gas liquids were up 155.4% to $30.8 per barrel from $12.06 in the prior-year quarter.
Realized gas prices were up 79.9% to $2.77 per thousand cubic feet from $1.54 in the prior-year quarter.
Total oil equivalent realized prices — including cash settlements — were $40.48 per Boe, up 76.5% year over year.
Other Highlights
Total production expenses for the third quarter were $555 million, increasing 104.8% year over year.
The board of directors authorized a $1-billion share buyback, representing 4% of Devon’s market capitalization. Free cash flow generation was $1.1 billion, an eight-fold increase from the fourth-quarter 2020 level.
Financing costs for the reported quarter were $86 million, up 30.3% from $66 million in the year-ago period.
Financial Highlights
As of Sep 30, 2021, the company had cash and cash equivalents including restricted cash of $2,321 million, up from $2,237 million on Dec 31, 2020. It exited the third quarter with $2.3 billion of liquidity and no debt maturities till 2023.
As of Sep 30, 2021, long-term debt amounted to $6,492 million, up from $4,298 million on Dec 31, 2020.
Devon Energy’s net cash from operating activities for third-quarter 2021 was $1,598 million compared with $427 million in the year-ago period.
Guidance
It expects total production for the fourth quarter in the range of 583,000-601,000 Boe/d. Fourth-quarter expenditure is projected in the range of $465-$535 million.
The company’s 2022 total production is expected in the range of 570,000-600,000 Boe/d and upstream capital investment within $1.9-$2.2 billion.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 10.39% due to these changes.
VGM Scores
Currently, Devon Energy has a great Growth Score of A, a grade with the same score on the momentum front. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. 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. It comes with little surprise Devon Energy has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.