DVN Stock Risk & Deep Value Analysis
Devon Energy Corp
Energy • Oil & Gas E&P
DVR Score
out of 10
What You Need to Know About DVN Stock
We analyzed Devon Energy Corp using our deep value framework. Sign in to see our full verdict and DVR Score.
We ran DVN through our deep value framework — analyzing financial health, distress signals, competitive moat, and risk factors. Our risk assessment: Moderate. Here's what we found.
DVN Risk Analysis & Red Flags
What Could Go Wrong
The biggest risk is a sustained and significant decline in crude oil and natural gas prices, which directly impacts Devon Energy's revenue, profitability, and ability to generate free cash flow and return capital to shareholders. Geopolitical instability or a global economic slowdown could trigger such a price collapse.
Risk Matrix
Overall
Moderate
Financial
Low
Market
High
Competitive
Medium
Execution
Medium
Regulatory
Medium
Red Flags
- ⚠
Exposure to volatile commodity prices (oil and gas)
- ⚠
Inherent cyclicality of the E&P sector limits consistent growth
- ⚠
Aging asset base requiring ongoing significant capital expenditures
Upcoming Risk Events
- 📅
Significant decline in global oil and natural gas prices
- 📅
Unfavorable regulatory changes impacting fossil fuel production
- 📅
Higher-than-expected production costs or capital expenditures
When to Reconsider
- 🚪
Exit if WTI crude oil prices fall consistently below $70/barrel for more than 3 months.
- 🚪
Sell if management significantly reduces the fixed + variable dividend or suspends buyback programs.
- 🚪
Exit if quarterly oil production guidance sees a sustained downward revision (e.g., 5%+ for two consecutive quarters).
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What Does Devon Energy Corp (DVN) Do?
Market Cap
$31.71B
Sector
Energy
Industry
Oil & Gas E&P
Employees
2,300
Devon Energy Corporation, an independent energy company, engages in the exploration, development, and production of oil, natural gas, and natural gas liquids in the United States. It operates in Delaware Basin located in southeast New Mexico and west Texas, Eagle Ford located in North America, Anadarko Basin located in western Oklahoma, Williston Basin located in North Dakota, and Powder River Basin located in Wyoming. Devon Energy Corporation was founded in 1971 and is headquartered in Oklahoma City, Oklahoma.
Visit Devon Energy Corp WebsiteInvestment Thesis
Devon Energy is a well-managed, high-quality independent E&P company with a robust asset base in the Permian. It is positioned as a strong free cash flow generator, committed to returning capital to shareholders through its fixed + variable dividend strategy. The investment thesis is based on its ability to sustain strong operational performance and shareholder distributions in a favorable commodity price environment, making it an attractive value play, rather than a hyper-growth investment, in the energy sector.
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DVN Price Targets & Strategy
12-Month Target
$56.00
Bull Case
$68.00
Bear Case
$45.00
Valuation Basis
Based on 10.5x forward P/E applied to consensus FY2026 EPS of $5.31.
Entry Strategy
Consider dollar-cost averaging on dips between $48-$50, targeting levels of historical support. Current price of $51.37 is near a 50-day moving average.
Exit Strategy
Consider profit-taking at $65-$68 if oil prices remain strong and operational performance exceeds expectations. Implement a stop-loss at $45 to protect against significant oil price downturns or operational misses.
Portfolio Allocation
1-3% for moderate risk tolerance, primarily as a value/income play in the energy sector.
Price Targets & Strategy
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Is DVN Financially Healthy?
Valuation
P/E Ratio
12.00
Forward P/E
9.92
PEG Ratio
0.83
Price/Sales
1.90
Profitability
Gross Margin
46.46%
Operating Margin
22.95%
Net Margin
15.37%
Return on Equity
17.47%
Revenue Growth
7.83%
EPS
$4.18
Balance Sheet
Current Ratio
0.98
Quick Ratio
0.90
Debt/Equity
0.54
Cash Flow
Free Cash Flow
$1.41B
Other
Beta (Volatility)
0.51
Dividend Yield
1.88%
Does DVN Have a Competitive Moat?
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🛡️ Narrow
Moat Trend
Stable
Moat Sources
2 Identified
Devon's moat is primarily driven by its prime acreage in the Permian Basin, which offers low-cost production and robust well economics. This asset quality, combined with operational expertise, provides a durable competitive advantage within the E&P sector, albeit one subject to commodity price volatility and resource depletion over the very long term.
Moat Erosion Risks
- •Technological advancements by competitors that lower their production costs
- •Shifts in government policy or regulations impacting drilling permits and environmental compliance
- •Depletion of existing reserves without successful replacement via new discoveries or acquisitions
DVN Competitive Moat Analysis
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DVN Market Intelligence
Sentiment & Insider Activity
Social Sentiment
Neutral (General sentiment often tied to oil price outlook, no specific recent DVN-driven retail buzz reported).
Institutional Sentiment
Positive (Zacks Rank #2 (Buy) due to upward EPS revisions for Q1 2026 and FY2026, indicating analyst confidence in near-term performance).
Insider Activity (Form 4)
No significant insider buying or selling reported in the last 90 days according to available data.
Options Flow
Normal options activity (No unusual or significant institutional options activity indicating strong bullish or bearish conviction reported).
Earnings Intelligence
Next Earnings
2026-05-05
Surprise Probability
Medium
Historical Earnings Pattern
Devon Energy has historically beaten EPS estimates in 3 of the last 4 quarters, suggesting a tendency for management to meet or slightly exceed expectations. Stock price reaction is typically influenced by guidance and commodity price outlook as much as, or more than, the quarterly beat/miss itself.
Key Metrics to Watch
Competitive Position
Top Competitor
EOG Resources (EOG)
Market Share Trend
Stable (DVN maintains its position as a major independent producer, primarily focused on optimizing existing core assets rather than aggressive market share expansion).
Valuation vs Peers
Devon Energy generally trades in line with or at a slight discount to premium independent E&P peers like EOG Resources, reflecting its strong asset base (Permian) but also the broader sector's cyclicality and valuation constraints. Current forward P/E around 9-10x for DVN is typical for the sector.
Competitive Advantages
- •High-quality, low-cost asset base in the Permian Basin
- •Operational efficiency and expertise in horizontal drilling
- •Strong free cash flow generation capability in a favorable price environment
Market Intelligence
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What Could Drive DVN Stock Higher?
Near-Term (0-6 months)
- •Q1 2026 Earnings Release (May 5, 2026)
- •Conference Call and Guidance Update (May 6, 2026)
Medium-Term (6-18 months)
- •Continued operational efficiency improvements in the Permian Basin
- •Potential opportunistic bolt-on acquisitions to enhance asset quality
- •Dividend policy updates based on free cash flow generation
Long-Term (18+ months)
- •Sustained global energy demand growth
- •Advancements in carbon capture or emissions reduction technologies
- •Industry consolidation leading to enhanced scale and pricing power
Catalysts & Growth Drivers
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What's the Bull Case for DVN?
- ✓
Sustained WTI crude oil prices above $80/barrel.
- ✓
Consistent free cash flow generation and dividend payouts.
- ✓
Successful execution of capital expenditure plans within guidance.
Bull Case Analysis
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Competing with DVN
See how Devon Energy Corp compares to related companies
| Company | Market Cap | DVR Score | P/E | Revenue | Profit Margin | Rev Growth | |
|---|---|---|---|---|---|---|---|
Devon Energy Corp DVN | $31.7B | 0.5 | 12.0 | $16.0B | 15.4% | 7.8% | |
Chevron Corp CVX | $317.8B | 0.1 | 20.3 | — | — | — | Compare → |
EOG Resources Inc EOG | — | 1.2 | — | — | — | — | Compare → |
Slb NV SLB | $79.4B | 0.9 | 23.5 | $40.0B | 9.4% | -1.6% | Compare → |
Exxon Mobil Corp XOM | $644.6B | 2.0 | 22.3 | $85.1B | 8.9% | -4.5% | Compare → |
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How Devon Energy Corp Makes Money
Devon Energy is an independent oil and natural gas exploration and production (E&P) company that primarily focuses on extracting hydrocarbons from prime onshore U.S. basins, most notably the Permian Basin. The company generates revenue by selling the crude oil, natural gas, and natural gas liquids it produces to refineries, utility companies, and industrial customers. Its business model relies on efficient drilling, disciplined capital allocation, and optimizing production from its high-quality asset portfolio to maximize cash flow and shareholder returns.
Read Full Business Model BreakdownFAQ
What is the DVR Score for Devon Energy Corp (DVN)?
As of May 1, 2026, Devon Energy Corp has a DVR Score of 0.5 out of 10, placing it in the "Distressed" category. This score is generated by our AI-powered deep value analysis framework that evaluates growth potential, financial health, competitive moat, and risk factors.
What is the market capitalization of Devon Energy Corp?
Devon Energy Corp's market capitalization is approximately $31.7B. The company operates in the Energy sector within the Oil & Gas E&P industry.
What ticker symbol does Devon Energy Corp use?
DVN is the ticker symbol for Devon Energy Corp. The company trades on the NYQ.
What is the risk level for DVN stock?
Our analysis rates Devon Energy Corp's overall risk as Moderate. This assessment considers execution risk, market risk, financial risk, competitive risk, and regulatory risk. For a full breakdown, see the risk analysis section above.
What is the P/E ratio of DVN?
Devon Energy Corp currently has a price-to-earnings (P/E) ratio of 12.0. This is below the market average, which could indicate the stock is undervalued or facing headwinds.
Does Devon Energy Corp pay a dividend?
Yes, Devon Energy Corp pays a dividend with a current yield of approximately 1.88%.
Is Devon Energy Corp's revenue growing?
Devon Energy Corp has reported revenue growth of 7.8%. The company is growing at a moderate pace.
Is DVN stock profitable?
Devon Energy Corp has a profit margin of 15.4%. The company is profitable but margins are modest.
How often is the DVN DVR analysis updated?
Our AI-powered analysis of Devon Energy Corp is refreshed regularly to incorporate the latest financial data, market conditions, and news. The most recent update was on May 1, 2026.
Important Disclaimer – Not Financial Advice
Deep Value Reports is an independent research platform for educational and informational purposes only. We are not financial advisors, investment advisors, or licensed professionals. The analysis, scores, and information provided on this page for DVN (Devon Energy Corp) should not be construed as personalized investment advice, a recommendation to buy or sell any security, or an offer to provide investment advisory services.
All investments involve risk, including the potential loss of principal. Past performance does not guarantee future results. Always conduct your own research, consider your financial situation, and consult with a qualified financial advisor before making any investment decisions.