Back to top

Image: Bigstock

Devon (DVN) to Report Q1 Earnings: What's in the Offing?

Read MoreHide Full Article

Devon Energy Corporation (DVN - Free Report) is set to report first-quarter 2023 results on May 8, after market close. This oil and gas company delivered a negative earnings surprise of 5.14% in the last reported quarter.

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

Factors at Play

Devon Energy is likely to have generated strong free cash flow in the first quarter of 2023, which was utilized to buy back shares and reduce its outstanding debts. These actions are likely to have a positive impact on earnings.

Devon Energy’s multi-basin, high-quality domestic assets are likely to have strong production volumes in the first quarter. However, downtime in the Delaware basin, ethane rejection and other temporary factors are likely to have lowered production volumes by 10,000 barrels of oil equivalents (Boe) per day in the first quarter, reducing profits.

Expectations

The Zacks Consensus Estimate for first-quarter earnings is pegged at a loss of 23 cents, which is on par with the year-ago quarter’s figure.

Devon Energy expects total revenues for the first quarter to be $417.5 million, implying year-over-year growth of 21.82%.

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 -1.38%. 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.

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.

Permian Resources Corporation (PR - Free Report) is set to deliver an earnings surprise when it posts first-quarter earnings on May 8, 2023. PR has an Earnings ESP of +2.33%.

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

Permian Resources reported an average earnings surprise of 6.1% in the last four quarters. The Zacks Consensus Estimate for PR’s 2023 earnings imply year-over-year growth of 29.6%.

Occidental Petroleum (OXY - Free Report) is set to announce an earnings surprise when it reports first-quarter earnings on May 9, 2023. OXY has an Earnings ESP of +0.09% and has a Zacks Rank #3.

Occidental’s long-term (three- to five-year) earnings growth is 21.99%. The Zacks Consensus Estimate for OXY’s earnings of 2023 imply a year-over-year decline of 37.9%.

Fluence Energy, Inc. (FLNC - Free Report) is set to announce an earnings surprise when it reports fiscal second-quarter earnings on May 10, 2023. FLNC has an Earnings ESP of +10.00% and has a Zacks Rank #3.

The Zacks Consensus Estimate for FLNC’s earnings in 2023 imply year-over-year growth of 69.7%.

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

Published in