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Devon Energy (DVN) to Post Q4 Earnings: What's in the Cards?

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Devon Energy Corporation (DVN - Free Report) is set to report fourth-quarter earnings on Feb 14, after market close. This oil and gas company delivered an earnings surprise of 2.35% in the last reported quarter.

Let’s discuss the factors that are likely to be reflected in the upcoming quarterly results.

Factors at Play

The acquisitions of RimRock Oil and Gas LP in the Williston Basin and Validas Energy in the Eagle Ford Shale are expected to have contributed positively to Devon’s fourth-quarter earnings. However, the severe winter weather conditions during fourth-quarter in Devon’s service territories adversely impacted production volumes and the Williston Basin operation was most impacted. As a consequence, the company expects its production volumes to be down by 2% from its prior expected range of 640,000-660,000 barrels of oil equivalent per day (Boe/d).

Devon Energy’s fourth-quarter earnings are likely to benefit from its ongoing share repurchases. In the first nine months of 2022, the company repurchased shares worth $1.25 billion. Devon’s low-cost structure and strong commodity prices are likely to have boosted fourth-quarter earnings.

Expectations

The Zacks Consensus Estimate for fourth-quarter earnings per share and total revenues are currently pegged at $1.77 and $4.65 billion, respectively, which reflects year-over-year growth of 23.7% and 8.8%, respectively.

What Our Quantitative Model Predicts

Our proven model does not conclusively predict an earnings beat for Devon Energy this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here, as you will see below.

 

Devon Energy Corporation Price and EPS Surprise

Devon Energy Corporation Price and EPS Surprise

Devon Energy Corporation price-eps-surprise | Devon Energy Corporation Quote

Earnings ESP: Devon Energy has an Earnings ESP of -3.49%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Devon Energy currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks to Consider

Investors can consider the following players from the same sector that have the right combination of elements to beat on earnings in this reporting cycle.

ProPetro Holding Corp. (PUMP - Free Report) is likely to come out with an earnings surprise when it reports fourth-quarter earnings on Feb 21, 2023. PUMP has an Earnings ESP of +21.30% and sports a Zacks Rank #1.

ProPetro Holding reported an average earnings surprise of 64.03% in the last three quarters. The Zacks Consensus Estimate for 2022 earnings of ProPetro Holding implies year-over-year growth of 160.4%.

Viper Energy Partners LP (VNOM - Free Report) is likely to come out with an earnings surprise when it reports fourth-quarter earnings on Feb 21, 2023. VNOM has an Earnings ESP of +3.57% and has a Zacks Rank #3.

Viper Energy Partners reported an average earnings surprise of 51.04% in the last four quarters. The Zacks Consensus Estimate for 2022 earnings of Viper Energy Partners implies year-over-year growth of 227.6%.

Cheniere Energy, Inc. (LNG - Free Report) is likely to come out with an earnings surprise when it reports fourth-quarter earnings on Feb 23, 2023. LNG has an Earnings ESP of +18.82% and has a Zacks Rank #3.

The Zacks Consensus Estimate for 2022 earnings of Cheniere Energy implies year-over-year growth of 63.2%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

 

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