Why NYSE:DVN provides a good dividend, while having solid fundamentals.

Our stock screening tool has identified DEVON ENERGY CORP (NYSE:DVN) as a strong dividend contender with robust fundamentals. NYSE:DVN exhibits commendable financial health and profitability, all while offering a sustainable dividend. Let's delve into each aspect below.

Analyzing Dividend Metrics

ChartMill employs its own Dividend Rating system for all stocks. This score, on a scale of 0 to 10, is determined by evaluating different dividend factors, such as yield, historical performance, dividend growth, and sustainability. NYSE:DVN has been assigned a 7 for dividend:

• DVN has a Yearly Dividend Yield of 6.55%, which is a nice return.
• Compared to an average industry Dividend Yield of 6.37, DVN pays a bit more dividend than its industry peers.
• Compared to an average S&P500 Dividend Yield of 2.45, DVN pays a better dividend.
• The dividend of DVN is nicely growing with an annual growth rate of 84.16%!
• DVN has paid a dividend for at least 10 years, which is a reliable track record.
• DVN has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.

Exploring NYSE:DVN's Health

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NYSE:DVN was assigned a score of 5 for health:

• DVN has an Altman-Z score of 3.32. This indicates that DVN is financially healthy and has little risk of bankruptcy at the moment.
• The Altman-Z score of DVN (3.32) is better than 77.57% of its industry peers.
• The Debt to FCF ratio of DVN is 2.25, which is a good value as it means it would take DVN, 2.25 years of fcf income to pay off all of its debts.
• The Debt to FCF ratio of DVN (2.25) is better than 69.16% of its industry peers.
• Even though the debt/equity ratio score it not favorable for DVN, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.

Evaluating Profitability: NYSE:DVN

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NYSE:DVN has achieved a 6:

• DVN has a better Return On Assets (19.70%) than 81.78% of its industry peers.
• DVN has a Return On Equity of 41.03%. This is amongst the best in the industry. DVN outperforms 83.18% of its industry peers.
• The Return On Invested Capital of DVN (26.44%) is better than 89.72% of its industry peers.
• DVN's Profit Margin has improved in the last couple of years.
• In the last couple of years the Operating Margin of DVN has grown nicely.

More Best Dividend stocks can be found in our Best Dividend screener.

Check the latest full fundamental report of DVN for a complete fundamental analysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.