Start here if you're new
what it is
Devon pulls oil, natural gas liquids, and natural gas out of U.S. shale fields and sells them into energy markets.
how it gets paid
Last year Devon Energy made $16.8B in revenue. oil sales was the main engine at $8.7B, or 52% of sales.
why it's growing
Revenue grew 5.4% last year. Annual revenue was $16.8B, up 5.4% vs. prior year.
what just happened
Revenue hit $12.8B, but the last reported EPS miss shows the stock is still trading on expectations, not just scale.
At a glance
B++ balance sheet — above average — nothing keeping you up at night
30/100 earnings predictability — expect surprises
10.9x trailing p/e — the market's not buying it — or you found a deal
2.6% dividend yield — cash in your pocket every quarter
11.0% return on capital — nothing to write home about
xvary composite: 58/100 — below average
What they do
Devon pulls oil, natural gas liquids, and natural gas out of U.S. shale fields and sells them into energy markets.
Devon wins on basin scale and operating discipline. It produced 737,000 barrels of oil equivalent per day in 2024, and a 45.0% operating margin means almost half of each revenue dollar survived operating costs. In oil and gas, scale advantage → bigger production base → lower unit costs, so you care because low-cost barrels stay alive longer when prices fall.
How they make money
$16.8B
annual revenue · their business grew +5.4% last year
oil sales
$8.7B
+7.0%
natural gas sales
$4.0B
+3.0%
ngl sales
$3.0B
+4.0%
marketing and midstream
$0.9B
+2.0%
other revenue
$0.2B
flat
The products that matter
core shale production
Delaware Basin Operations
853 Mboe/d
Q3 2025 production reached 853 thousand barrels of oil equivalent per day. That beat guidance, which matters because volume is one of the few levers management controls.
scale asset
premium gas sales
Gas Marketing Agreements
115 MMcf/d
Two long-term contracts cover 115 million cubic feet per day starting in 2026. That does not remove gas price risk, but it does improve where Devon sells into the market.
pricing help
capital plan
2026 Production Program
835–855 Mboe/d
Management's 2026 output range sits at 835–855 thousand boe per day while capital spending is set to fall by about $500M. That's the efficiency claim in one line.
execution bet
Key numbers
45.0%
operating margin
Operating margin → profit left after running the business → so what: Devon's wells throw off real cash when prices cooperate.
10.9x
trailing p/e
Price-to-earnings → what you pay for each dollar of profit → so what: Devon is cheap versus the market because energy profits are not trusted.
$16.8B
annual revenue
Revenue → total sales → so what: Devon is not a tiny shale story anymore; it is already operating at major scale.
2.6%
dividend yield
Dividend yield → cash paid back to you each year → so what: you get some return while waiting for oil prices and the merger to play out.
Financial health
B++
strength
- balance sheet grade B++ — above average financial health
- risk rank 3 — safer than 50% of stocks
- price stability 35 / 100
- long-term debt $7393.0B (100% of capital)
- net profit margin 15.6% — keeps 16 cents of every dollar in revenue
- return on equity 14% — $0.14 profit for every $1 investors have put in
B++ — net profit margin looks solid but long-term debt needs watching.
Total return vs. market
You invested $10,000 in DVN 3 years ago → it's now worth $8,140.
The index would have given you $13,880.
source: institutional data · total return
What just happened
missed estimates
Revenue hit $12.8B, but the last reported EPS miss shows the stock is still trading on expectations, not just scale.
Annual revenue was $16.8B, up 5.4% vs. prior year. But the latest reported earnings surprise was -1.1%, with actual EPS of $0.90 versus a $0.91 estimate.
$12.8B
revenue
$0.90
eps
45.0%
gross margin
the number that mattered
The key number was the $0.01 EPS miss, because a commodity producer at 10.9x earnings does not get much room for small disappointments.
-
devon has agreed to buy coterra energy in an all-stock transaction.under terms of the proposed deal, devon will issue.70 of a dvn share for each coterra share, implying a combined enterprise value of $58 billion. both businesses see the tie-up as an opportunity to increase scale, accelerate free cash growth, and generate $1.0 billion in pre-tax.
-
the new energy supplier would have a presence in all major u.s. shale areas.both companies have considerable holdings in the permian basin, while devon owns assets in the eagle ford and williston basins and coterra has acreage in the marcellus. combining liquids-rich land in the permian with the natural gasabundant areas in the marcellus helps bring exposure to myriad energy markets. note that pro forma 2025 third-quarter production exceeded 1.6 million barrels of oil equivalent (boe).
-
management’s focus remains on enhancing capital efficiency.fourth-quarter results (to be released shortly after we went to press with this report) probably included 383,000 to 388,000 barrels of oil and 828,000 to 844,000 boe. as for 2026, total output will probably be in a range of 835,000 to 855,000 boe (including around 388,000 barrels of oil). while the company is looking to maintain recent production levels in 2026, capital requirements for the 52-week period are apt to moderate by approximately $500 million.
-
devon is in the middle of a business optimization plan (60% complete at the end of the september period) that is intended to generate an incremental $1.0 billion in annual pretax free cash flow.this follows the completion of numerous gas marketing agreements to sell natural gas into markets offering premiums.
-
devon shares recently rose to a new 52-week high price.positive momentum coincided with price gains for various energy products and reports of the aforementioned merger, which led us to suspend the stock’s outlook rank. as the company is currently configured, the issue holds worthwhile 3 to 5-year total return potential, supported by an ongoing $5.0 billion share-repurchase program (worth between $200 million and $300 million in buybacks per quarter) and debt reduction initiatives.
source: company earnings report, 2026
Get this snapshot in your inbox
This page, delivered free — plus weekly updates when the numbers change. plain english, no spam.
weekly updates
earnings alerts
plain english
no spam
What could go wrong
The top risk is commodity prices weakening while the Coterra deal adds another layer of execution risk.
med
Oil and gas prices roll over
Devon sells crude, gas, and NGLs at market prices. Q4 revenue already fell 10.6% vs. prior year even with a beat versus estimates.
This risk touches nearly all of the $16.8B revenue mix shown above. Cheap energy multiples get cheaper fast when the commodity strip breaks.
med
Coterra deal fails or drags
The antitrust deadline now runs to February 1, 2027. If regulators block the deal or the process drags, the scale case goes with it.
The market is already pricing some merger upside into the story. Take that away and you are back to a standalone shale producer with cyclical earnings.
med
Efficiency plan does not show up in cash flow
Management wants to hold 2026 production at 835–855 Mboe/d while spending about $500M less and finishing a plan aimed at $1.0B in annual pretax free cash flow.
If output slips or spending creeps back up, the whole "better operator at bigger scale" argument starts to look thin.
med
Environmental and permitting pressure
A prior EPA notice tied to alleged air-permit violations shows the usual upstream risk: drilling is a regulated business with real operating consequences.
Fines are one thing. Production interruptions and permit friction are the bigger problem because they hit volume, timing, and investor confidence at once.
Commodity prices touch almost all of Devon's $16.8B revenue mix, and the merger adds a February 1, 2027 regulatory clock on top of that.
source: institutional data · regulatory filings · risk analysis
Pay attention to
earnings
Q1 2026 earnings report
Expected May 5, 2026. Consensus calls for $0.67 in EPS on $4.00B of revenue. You want to see whether volume holds up better than pricing.
merger
Coterra antitrust clock
The outside date is February 1, 2027. Devon holders are supposed to own about 54% of the combined company if it closes.
commodity tape
Oil and gas prices versus realized revenue
Crude is 55% of revenue and gas is 30%. If both weaken at once, the low multiple stops looking like protection.
execution
Lower spending, flat output
Management is aiming for 835–855 Mboe/d while spending about $500M less. That is the cleanest test of whether the efficiency pitch is real.
Analyst rankings
earnings predictability
30 / 100
In human-speak, analysts do not trust this business to deliver smooth quarters.
risk rank
3
Middle-of-the-pack safety. Safer than the worst energy names, nowhere near a defensive stock.
price stability
35 / 100
The stock moves around because the business moves around. Welcome to shale equities.
source: institutional data
Institutional activity
institutions have been net selling for 2 consecutive quarters — 501 buyers vs. 507 sellers in 3q2025. total institutional holdings: 0.5B shares. net selling for 2 quarters.
source: institutional data
Price targets
3-5 year target range
$23
$55
$43
current price
$39
target midpoint · 10% from current · 3-5yr high: $70 (+60% · 15% ann'l return)
Want the deeper analysis?
The full deep dive: dcf model, scenario analysis, competitive moat breakdown, and quarterly tracking — everything on this page, taken further.
see plans from $5/moThe deep dive