Retirement is complicated and you only get once chance to do it right. Don't miss out because you didn't know what was out there.The Retirement Forum provides actionable ideals, a high-yield safe retirement portfolio, and macroeconomic outlooks, all to help you maximize your capital and your income. We search the entire market to help you maximize returns.Devon Energy (NYSE: DVN ) is a mid-cap oil company worth just under $25 billion. The company has gone up almost 10% since we last recommended buying the d ...

Investors interested in Oil and Gas - Exploration and Production - United States stocks are likely familiar with Devon Energy (DVN) and EOG Resources (EOG) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimat ...

Core Viewpoint - Devon Energy is considered an attractive stock for investors with a long-term optimistic outlook on oil and gas, particularly due to its operational progress and integration of the Grayson Mill acquisition [2][5]. Production and Financial Performance - In Q4, Devon Energy achieved total oil and gas production of 848,000 barrels of oil equivalent per day (BOE/D), exceeding prior estimates of 811,000 to 830,000 BOE/D [2]. - The outperformance was attributed to better well productivity in the Eagle Ford assets and a contribution of 117,000 BOE/D from the Grayson Mill acquisition, surpassing the previous estimate of 110,000 BOE/D [3]. - Management raised its 2025 production guidance by 2% to a range of 805,000 to 825,000 BOE/D, projecting free cash flow (FCF) of over $3 billion at an oil price of $70 per barrel, which represents 12.3% of its market cap of approximately $24.4 billion [4]. Capital Allocation and Dividend Policy - Devon Energy's capital allocation plan allocates 30% of FCF to improve its balance sheet and 70% for returning cash to investors through share buybacks and dividends [6]. - The variable dividend component was eliminated in Q3 2024, with management focusing on a sustainable, annually growing fixed dividend, which is projected to yield 2.6% based on current prices if no variable dividend is paid in 2025 [7]. - The company plans to spend $800 million to $1.2 billion of the potential $3 billion in FCF on share buybacks, with a fixed dividend costing approximately $620 million in 2025 and $900 million earmarked for balance sheet improvements [9][10]. Strategic Outlook - Management believes that integrating Grayson Mill with existing assets will yield additional cost savings and enhance operational efficiency through continued investment in multizone projects in the Permian region [5]. - The focus for 2025 appears to be on debt repayment and share repurchases rather than a variable dividend, with $1.5 billion of its $8.9 billion debt maturing in 2025 and 2026 [10]. - The capital allocation strategy is viewed positively, as it is expected to reduce share count and interest payments, leading to increased cash flow per share for investors in the future [11].

Devon Energy Corporation (DVN) reported better-than-expected fourth-quarter 2024 earnings per share on Feb. 18. Earnings and revenues surpassed the respective Zacks Consensus Estimate by 16% and 3.9%. The fourth-quarter performance was driven by strong production volumes and production from the Rockies and Eagle Ford exceeding estimates due to strong new well productivity, offset marginally by the drop in realized commodity prices.See the Zacks Earnings Calendar to stay ahead of market-making news.DVN has b ...

Core Insights - Zacks Premium offers various tools to help investors make informed decisions and enhance their confidence in the stock market [1] - The Zacks Style Scores provide a unique rating system for stocks based on value, growth, and momentum characteristics, aiding investors in selecting securities with high potential for market outperformance [2][3] Zacks Style Scores Overview - Stocks are rated from A to F based on their value, growth, and momentum characteristics, with A indicating the highest potential for outperformance [3] - The Style Scores are categorized into four types: Value Score, Growth Score, Momentum Score, and VGM Score, each focusing on different investment strategies [3][4][5][6] Value Score - The Value Score identifies attractive stocks using financial ratios such as P/E, PEG, Price/Sales, and Price/Cash Flow, targeting undervalued stocks [3] Growth Score - The Growth Score assesses stocks based on projected and historical earnings, sales, and cash flow, focusing on companies with sustainable growth potential [4] Momentum Score - The Momentum Score evaluates stocks based on price trends and earnings estimate changes, helping investors capitalize on upward or downward price movements [5] VGM Score - The VGM Score combines all three Style Scores, providing a comprehensive indicator for investors who utilize multiple investment strategies [6] Zacks Rank - The Zacks Rank is a proprietary model that uses earnings estimate revisions to help investors build successful portfolios, with 1 (Strong Buy) stocks achieving an average annual return of +25.41% since 1988 [7][8] Stock to Watch: Devon Energy - Devon Energy Corporation, an independent energy company, is rated 2 (Buy) on the Zacks Rank and has a VGM Score of B [12] - The company has a Momentum Style Score of A, with shares increasing by 4.3% over the past four weeks, and upward revisions in earnings estimates for fiscal 2025 [13]

Group 1 - Devon Energy (DVN) shares have increased by 4.3% over the past four weeks, closing at $37.49, with a mean price target of $49.27 indicating a potential upside of 31.4% [1] - The mean estimate consists of 26 short-term price targets with a standard deviation of $5.73, where the lowest estimate is $43 (14.7% increase) and the highest is $67 (78.7% increase) [2] - Analysts show strong agreement on DVN's ability to report better earnings, with a positive trend in earnings estimate revisions suggesting potential upside [4][9] Group 2 - The Zacks Consensus Estimate for DVN has increased by 3.2% over the past month, with three estimates going higher and one going lower [10] - DVN holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [11] - While consensus price targets may not be reliable for predicting the extent of gains, they can provide guidance on price movement direction [12]

Core Insights - The S&P 500 has increased by 22.8% over the past year, driven by megacap growth and value stocks, prompting investors to consider out-of-favor companies for new capital allocation [1] - The energy sector presents numerous dividend-paying value stocks, particularly in the upstream segment [1] Occidental Petroleum (OXY) - Occidental Petroleum's share price rose by 4.4% following its Q4 and full-year 2024 results, despite a 15% decline over the past year [3] - The company reported a net loss of $297 million for the quarter but had a solid cash flow with $1.4 billion in free cash flow before working capital [4] - Occidental completed a $4.5 billion debt repayment and announced a $1.2 billion divestiture for Q1 2025, while its $12 billion acquisition of CrownRock is expected to generate $1 billion in free cash flow annually at $70 per barrel WTI [5][6] - The company has increased its quarterly dividend by 9%, raising the payout to $0.24 per share, yielding 1.9% [9] Diamondback Energy (FANG) - Diamondback Energy's stock has decreased by 10.7% over the past year, but oil prices have remained stable between $70 and $80 per barrel [10][11] - The company can sustain its base dividend of $3.60 per share with a break-even price of $37 per barrel, indicating resilience against price fluctuations [11] - Analysts project Diamondback will generate $3.5 billion in free cash flow in 2024 and $5 billion in 2025, which could support significant dividends and share buybacks [13] Devon Energy (DVN) - Devon Energy's stock has dropped over 13% in the past year, presenting a buying opportunity with a forward dividend yield of 4.2% [14] - The decline in stock price is largely due to falling energy prices, with WTI prices down about 9% over the past year [15] - Devon Energy's acquisition of Grayson Mill Energy strengthens its position in the Williston Basin, and the company maintains a conservative leverage approach with a net debt to EBITDA ratio of 1.1 [16][17] - The stock is currently valued at 3.3 times operating cash flow, below its five-year average of 4, indicating potential undervaluation [17]

Core Viewpoint - Devon Energy has successfully transformed its oil and gas resource portfolio to focus on generating free cash flow and returning capital to shareholders, particularly following its merger with WPX Energy in late 2020 [1] Financial Performance - In the previous year, Devon Energy generated $3 billion in free cash flow, returning $2 billion to shareholders [2] - The company produced $6.6 billion in operating cash flow, with $3.6 billion allocated for capital expenses, resulting in $3 billion of free cash flow [3] - Devon returned approximately two-thirds of its free cash flow to shareholders through dividends and share repurchases, including $900 million in fixed dividends and $1.1 billion in share buybacks [3] Capital Return Strategy - Devon shifted its capital return strategy towards stock buybacks, purchasing $300 million of its stock in the fourth quarter, which was more than double the dividend payouts [4] - The company utilized $1 billion of excess free cash flow to strengthen its balance sheet after acquiring Grayson Mill Energy for $5 billion [5] Future Projections - Devon anticipates a production increase of over 10% this year due to capital investments and the Grayson Mill Energy acquisition, with capital spending projected between $3.8 billion and $4 billion [6] - The company expects to generate more than $3 billion in free cash flow this year, assuming crude oil prices remain around $70 per barrel [7] Cash Return Plans - For 2025, Devon targets a cash return payout of up to 70% of generated free cash flow, potentially returning over $2.1 billion to shareholders [8] - The company announced a 9% increase in its dividend to $0.24 per share and plans for quarterly share repurchases of $200 million to $300 million [9] Strategic Outlook - Devon's strategy to focus on cash production and shareholder returns is expected to yield strong total returns for shareholders in the coming years [10]

Company Overview - Devon Energy was founded in 1971 by John Nichols and his son Larry, starting with five people and no assets, and has grown into one of the largest oil and gas producers in the U.S. [1] - The company went public in 1988 on the American Stock Exchange, allowing it to use its stock for acquisitions over the years [2]. Mergers and Acquisitions - Devon Energy has made significant acquisitions, including PennzEnergy for $723.4 million in 1999, Mitchell Energy for $3.1 billion in 2001, and Ocean Energy for $3.5 billion in 2003 [2]. - The company sold off all its international operations and offshore positions to focus on a leading multibasin onshore position in the U.S., highlighted by a $12 billion all-stock merger with WPX Energy in 2021 [4]. Stock Performance - Devon's stock has increased over 1,000% since its IPO, translating to an annual growth rate of about 7% [5]. - The historical performance indicates that mergers, particularly those funded with stock, do not always yield favorable outcomes for shareholders [5].

Group 1 - The article emphasizes the importance of delivering alpha-generating investment ideas through a structured and evidence-based approach [1] - The investment strategy is generalist, focusing on sectors with perceived alpha potential compared to the S&P 500, with typical holding periods ranging from a few quarters to multiple years [1] - The article suggests reviewing the ratings history of published articles as an indicator of the author's investment skill and the effectiveness of recommendations [1] Group 2 - The author has a beneficial long position in VOO shares, indicating a personal investment interest [2] - The article expresses the author's own opinions and is not influenced by compensation from any company mentioned [2] - There is a disclaimer that past performance does not guarantee future results, and the views expressed may not reflect those of Seeking Alpha as a whole [3]