Raymond James Raises Devon Energy (DVN) PT to $46 From $45

Core Insights - Devon Energy Corporation (NYSE:DVN) is recognized as one of the S&P 500 stocks with a low PE ratio, focusing on oil, natural gas, and natural gas liquids exploration and production [1] - Raymond James has raised the target price for DVN from $45 to $46, maintaining an Outperform rating based on the company's production and capital expenditure (capex) outperformance [2][5] Production and Capex Performance - Devon Energy outperformed production and capex forecasts by 2% and 7% respectively, leading to a $100 million reduction in 2025 capex for the second consecutive time [2] - The reduction in capex includes $75 million from the company's optimization program, contributing to an estimated additional $1 billion in free cash flow over the next three years [3] Future Projections - For Q3 2025, production is forecasted at approximately 837,000 barrels of oil equivalent per day, with a capex of $908 million, aligning with guidance and analyst expectations [4] - Full-year 2025 production is expected to be nearly 833,000 BOE/day, with capital expenditure projected at $3.7 billion, consistent with consensus estimates [4] Financial Metrics - Free cash flow yields are anticipated to be around 9% in 2025 and 10% in 2026, comparable to industry peers [5] - The projected EV/EBITDA for 2026 is 4.2x, slightly lower than the approximate 4.5x for peers, indicating improved capital efficiency for Devon Energy [5]