DEVON ENERGY CORP (DVN) Stock Fundamental Analysis
NYSE:DVN - New York Stock Exchange, Inc. - US25179M1036 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to DVN. DVN was compared to 213 industry peers in the Oil, Gas & Consumable Fuels industry. DVN has a medium profitability rating, but doesn't score so well on its financial health evaluation. DVN is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year DVN was profitable.
DVN had a positive operating cash flow in the past year.
DVN had positive earnings in 4 of the past 5 years.
Each year in the past 5 years DVN had a positive operating cash flow.
1.2 Ratios
DVN's Return On Assets of 9.02% is fine compared to the rest of the industry. DVN outperforms 79.81% of its industry peers.
DVN has a better Return On Equity (19.17%) than 81.69% of its industry peers.
The Return On Invested Capital of DVN (12.88%) is better than 85.92% of its industry peers.
DVN had an Average Return On Invested Capital over the past 3 years of 20.63%. This is significantly below the industry average of 25.88%.
The 3 year average ROIC (20.63%) for DVN is well above the current ROIC(12.88%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.02% | ||
| ROE | 19.17% | ||
| ROIC | 12.88% |
ROA(3y)16.63%
ROA(5y)7.21%
ROE(3y)34.79%
ROE(5y)8.28%
ROIC(3y)20.63%
ROIC(5y)N/A
1.3 Margins
DVN has a better Profit Margin (16.61%) than 68.08% of its industry peers.
DVN's Profit Margin has declined in the last couple of years.
DVN's Operating Margin of 26.00% is fine compared to the rest of the industry. DVN outperforms 60.56% of its industry peers.
DVN's Operating Margin has improved in the last couple of years.
DVN's Gross Margin of 49.75% is in line compared to the rest of the industry. DVN outperforms 56.34% of its industry peers.
In the last couple of years the Gross Margin of DVN has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26% | ||
| PM (TTM) | 16.61% | ||
| GM | 49.75% |
OM growth 3Y-0.73%
OM growth 5Y55.24%
PM growth 3Y-7.34%
PM growth 5YN/A
GM growth 3Y1.47%
GM growth 5Y-9.16%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so DVN is creating value.
Compared to 1 year ago, DVN has more shares outstanding
DVN has more shares outstanding than it did 5 years ago.
DVN has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.16 indicates that DVN is not a great score, but indicates only limited risk for bankruptcy at the moment.
DVN has a Altman-Z score of 2.16. This is in the better half of the industry: DVN outperforms 73.71% of its industry peers.
A Debt/Equity ratio of 0.58 indicates that DVN is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.58, DVN is in line with its industry, outperforming 42.72% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 2.16 |
ROIC/WACC1.31
WACC9.85%
2.3 Liquidity
DVN has a Current Ratio of 1.08. This is a normal value and indicates that DVN is financially healthy and should not expect problems in meeting its short term obligations.
DVN has a Current ratio (1.08) which is in line with its industry peers.
A Quick Ratio of 0.99 indicates that DVN may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.99, DVN is in line with its industry, outperforming 51.17% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.99 |
3. Growth
3.1 Past
The earnings per share for DVN have decreased by -9.63% in the last year.
The Earnings Per Share has been growing by 31.25% on average over the past years. This is a very strong growth
Looking at the last year, DVN shows a very negative growth in Revenue. The Revenue has decreased by -10.92% in the last year.
DVN shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 20.71% yearly.
EPS 1Y (TTM)-9.63%
EPS 3Y11.12%
EPS 5Y31.25%
EPS Q2Q%4.31%
Revenue 1Y (TTM)-10.92%
Revenue growth 3Y9.3%
Revenue growth 5Y20.71%
Sales Q2Q%23.8%
3.2 Future
The Earnings Per Share is expected to grow by 1.95% on average over the next years.
Based on estimates for the next years, DVN will show a small growth in Revenue. The Revenue will grow by 2.56% on average per year.
EPS Next Y-16.8%
EPS Next 2Y-6.36%
EPS Next 3Y1.59%
EPS Next 5Y1.95%
Revenue Next Year5.02%
Revenue Next 2Y2.34%
Revenue Next 3Y2.56%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 6.59, the valuation of DVN can be described as very cheap.
DVN's Price/Earnings ratio is rather cheap when compared to the industry. DVN is cheaper than 82.16% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.60. DVN is valued rather cheaply when compared to this.
DVN is valuated cheaply with a Price/Forward Earnings ratio of 7.60.
77.93% of the companies in the same industry are more expensive than DVN, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 22.43. DVN is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 6.59 | ||
| Fwd PE | 7.6 |
4.2 Price Multiples
80.75% of the companies in the same industry are more expensive than DVN, based on the Enterprise Value to EBITDA ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 3.64 |
4.3 Compensation for Growth
The decent profitability rating of DVN may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.21
EPS Next 2Y-6.36%
EPS Next 3Y1.59%
5. Dividend
5.1 Amount
DVN has a Yearly Dividend Yield of 2.87%.
Compared to an average industry Dividend Yield of 7.05, DVN has a dividend in line with its industry peers.
DVN's Dividend Yield is a higher than the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.87% |
5.2 History
The dividend of DVN is nicely growing with an annual growth rate of 34.02%!
DVN has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)34.02%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
28.72% of the earnings are spent on dividend by DVN. This is a low number and sustainable payout ratio.
DVN's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP28.72%
EPS Next 2Y-6.36%
EPS Next 3Y1.59%
32.17
-0.52 (-1.59%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners75.02%
Inst Owner Change-1.33%
Ins Owners0.43%
Ins Owner Change0.39%
Market Cap20.70B
Analysts78.24
Price Target45.52 (41.5%)
Short Float %3.35%
Short Ratio2.07
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.87% |
Yearly Dividend1.46
Dividend Growth(5Y)34.02%
DP28.72%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)5.1%
Min EPS beat(2)-4.28%
Max EPS beat(2)14.49%
EPS beat(4)2
Avg EPS beat(4)5.17%
Min EPS beat(4)-4.28%
Max EPS beat(4)14.49%
EPS beat(8)4
Avg EPS beat(8)3.4%
EPS beat(12)7
Avg EPS beat(12)2.94%
EPS beat(16)11
Avg EPS beat(16)5.09%
Revenue beat(2)2
Avg Revenue beat(2)1.9%
Min Revenue beat(2)0.2%
Max Revenue beat(2)3.6%
Revenue beat(4)3
Avg Revenue beat(4)2.48%
Min Revenue beat(4)-0.38%
Max Revenue beat(4)6.51%
Revenue beat(8)6
Avg Revenue beat(8)1.75%
Revenue beat(12)9
Avg Revenue beat(12)2.61%
Revenue beat(16)12
Avg Revenue beat(16)2.98%
PT rev (1m)-9.79%
PT rev (3m)-9.7%
EPS NQ rev (1m)-15.82%
EPS NQ rev (3m)-22.61%
EPS NY rev (1m)-8.41%
EPS NY rev (3m)-17.14%
Revenue NQ rev (1m)-5.63%
Revenue NQ rev (3m)-4.63%
Revenue NY rev (1m)-3.59%
Revenue NY rev (3m)-3.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 6.59 | ||
| Fwd PE | 7.6 | ||
| P/S | 1.23 | ||
| P/FCF | N/A | ||
| P/OCF | 3.04 | ||
| P/B | 1.42 | ||
| P/tB | 1.5 | ||
| EV/EBITDA | 3.64 |
EPS(TTM)4.88
EY15.17%
EPS(NY)4.24
Fwd EY13.17%
FCF(TTM)-1.07
FCFYN/A
OCF(TTM)10.58
OCFY32.88%
SpS26.11
BVpS22.61
TBVpS21.44
PEG (NY)N/A
PEG (5Y)0.21
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.02% | ||
| ROE | 19.17% | ||
| ROCE | 15.99% | ||
| ROIC | 12.88% | ||
| ROICexc | 13.47% | ||
| ROICexgc | 13.87% | ||
| OM | 26% | ||
| PM (TTM) | 16.61% | ||
| GM | 49.75% | ||
| FCFM | N/A |
ROA(3y)16.63%
ROA(5y)7.21%
ROE(3y)34.79%
ROE(5y)8.28%
ROIC(3y)20.63%
ROIC(5y)N/A
ROICexc(3y)21.8%
ROICexc(5y)N/A
ROICexgc(3y)22.62%
ROICexgc(5y)N/A
ROCE(3y)25.62%
ROCE(5y)N/A
ROICexcg growth 3Y-9.4%
ROICexcg growth 5Y53.9%
ROICexc growth 3Y-8.79%
ROICexc growth 5Y55.35%
OM growth 3Y-0.73%
OM growth 5Y55.24%
PM growth 3Y-7.34%
PM growth 5YN/A
GM growth 3Y1.47%
GM growth 5Y-9.16%
F-Score5
Asset Turnover0.54
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 1.08 | ||
| Cap/Depr | 217.5% | ||
| Cap/Sales | 44.61% | ||
| Interest Coverage | 9.43 | ||
| Cash Conversion | 87.1% | ||
| Profit Quality | N/A | ||
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.99 | ||
| Altman-Z | 2.16 |
F-Score5
WACC9.85%
ROIC/WACC1.31
Cap/Depr(3y)204.69%
Cap/Depr(5y)159.27%
Cap/Sales(3y)33.12%
Cap/Sales(5y)27.97%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-9.63%
EPS 3Y11.12%
EPS 5Y31.25%
EPS Q2Q%4.31%
EPS Next Y-16.8%
EPS Next 2Y-6.36%
EPS Next 3Y1.59%
EPS Next 5Y1.95%
Revenue 1Y (TTM)-10.92%
Revenue growth 3Y9.3%
Revenue growth 5Y20.71%
Sales Q2Q%23.8%
Revenue Next Year5.02%
Revenue Next 2Y2.34%
Revenue Next 3Y2.56%
Revenue Next 5YN/A
EBIT growth 1Y-24.78%
EBIT growth 3Y8.5%
EBIT growth 5Y87.39%
EBIT Next Year92.9%
EBIT Next 3Y23.9%
EBIT Next 5Y16.44%
FCF growth 1Y-124.98%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-18.71%
OCF growth 3Y10.44%
OCF growth 5Y26.09%