Why NYSE:DVN is a Top Pick for Dividend Investors.

Last update: Mar 20, 2024

DEVON ENERGY CORP (NYSE:DVN) has caught the attention of dividend investors as a stock worth considering. NYSE:DVN excels in profitability, solvency, and liquidity, all while providing a decent dividend. Let's delve into the details.

Dividend Assessment of NYSE:DVN

ChartMill assigns a proprietary Dividend Rating to each stock. The score is computed by evaluating various valuation aspects, like the yield, the history, the dividend growth and sustainability. NYSE:DVN was assigned a score of 7 for dividend:

DVN has a Yearly Dividend Yield of 5.06%, which is a nice return.
Compared to an average industry Dividend Yield of 5.94, DVN pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.40, DVN pays a better dividend.
On average, the dividend of DVN grows each year by 56.62%, which is quite nice.
DVN has paid a dividend for at least 10 years, which is a reliable track record.
39.25% of the earnings are spent on dividend by DVN. This is a low number and sustainable payout ratio.

Evaluating Health: NYSE:DVN

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 6 for health:

An Altman-Z score of 3.47 indicates that DVN is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.47, DVN is in the better half of the industry, outperforming 77.46% of the companies in the same industry.
The Debt to FCF ratio of DVN is 2.49, which is a good value as it means it would take DVN, 2.49 years of fcf income to pay off all of its debts.
DVN has a Debt to FCF ratio of 2.49. This is in the better half of the industry: DVN outperforms 70.89% of its industry peers.
A Debt/Equity ratio of 0.49 indicates that DVN is not too dependend on debt financing.

A Closer Look at Profitability for NYSE:DVN

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NYSE:DVN has earned a 6 out of 10:

DVN's Return On Assets of 19.33% is amongst the best of the industry. DVN outperforms 85.45% of its industry peers.
The Return On Equity of DVN (39.25%) is better than 85.45% of its industry peers.
The Return On Invested Capital of DVN (23.10%) is better than 88.26% of its industry peers.
The 3 year average ROIC (21.19%) for DVN is below the current ROIC(23.10%), indicating increased profibility in the last year.
The Profit Margin of DVN (24.81%) is better than 61.03% of its industry peers.
In the last couple of years the Operating Margin of DVN has grown nicely.

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For an up to date full fundamental analysis you can check the fundamental report of DVN

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.