Devon Energy Corporation
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
Devon Energy is a buy following the October 8, 2026 agreement to sell its Eagle Ford assets for $4.2 billion in cash, which high-grades the portfolio toward highest-return assets and provides meaningful debt-reduction capacity against $8.8B in total debt as of FY2025.
Q2 2026 results were strong with revenue of $7.4B and EPS of $2.03, beating estimates of $1.40 by 12.1%, while the stock trades at a reasonable 11.4x P/E (only 7.8% above the peer median of 10.6x) and sits above both its 50-day ($47.36) and 200-day ($44.90) moving averages as of October 9, 2026. CEO Clay Gaspar's open-market purchase at $51.08 in September 2026 and rising smart-money interest (65 funds, score of 0.05 as of Q2 2026) support the constructive setup, though gross margin compression to 25.6% in FY2025 from 43.7% in FY2022 and an EV/EBITDA of 7.2x — 52.8% above the peer median of 4.7x — temper conviction.
What could go wrong
- Margin compression trend. Gross margin has declined from 43.7% in FY2022 to 25.6% in FY2025, and net income fell 8.6% YoY in FY2025 despite 7.8% revenue growth, signaling cost structure or commodity-price pressure eroding profitability.
- Rich EV/EBITDA vs. peers. DVN trades at 7.2x EV/EBITDA, a 52.8% premium to the peer median of 4.7x, suggesting the market may have already priced in portfolio optimization benefits.
- Eagle Ford deal execution risk. The $4.2B sale to Crescent Energy is subject to customary closing adjustments; failure to close or unfavorable adjustments could delay debt reduction and financial flexibility.
- Insider net selling over 24 months. Over the trailing 24 months, insider transactions show net dispositions of 52,870 shares worth approximately $2.4M, with only one acquisition and four dispositions, though the CEO's recent purchase is a partial offset.
What would change my mind
Where this comes from: GlobeNewsWire press release, 8 Oct · quarterly results and earnings vs estimates · peer comparison · FY25 fundamentals. Orin's read on DVN; not advice.
How has the share price moved?
Up 55.6% over twelve months, from $32.93 on 27 Oct 2025 to $51.23 at the Tue 27 Oct 2026 close. Its highest close in that time was $52.07 on 27 Mar 2026; the last close is 1.6% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 56.1M, on 20 Mar 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All DVN filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $3.9B | 0.1% |
| Vanguard Capital Management | $3.1B | 0.1% |
| State Street | $3.0B | 0.1% |
| Vanguard Portfolio Management | $2.4B | 0.1% |
| Wellington Management Group | $2.1B | 0.4% |
| Charles Schwab Investment Management | $1.6B | 0.2% |
| Geode Capital Management | $1.3B | 0.1% |
| Invesco | $997.8M | 0.1% |
| Morgan Stanley | $971.6M | 0.1% |
| D. E. Shaw | $497.7M | 0.2% |
121 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 80 Form 4 filings; open-market trades net −$2.2M. Of the 50 on hand, 2 were open-market purchases and 3 sales — the rest are grants, option exercises and tax withholding.
Ask Orin about DVN
Orin answers questions about DVN from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 10.1× its last 12 months of profit (Thu 5 Nov close) — higher than in 4 of its last 5 fiscal years (middle 7.7×); the typical Energy company on the NYSE is at 17.6×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 10.1×above usual | 7.7× | 17.6× |
| P/S | 2.40×above usual | 1.90× | — |
| EV/EBITDA | 6.6×above usual | 4.4× | — |
| P/B | 1.0×below usual | 2.4× | — |
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $62.56 (from $54 to $68) — 22% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$62.56
$54 – $68 · +22% against the last close
- 16 buy or overweight
- 2 hold
- 0 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 10.1× its last 12 months of profit; the middle P/E of the 4 companies it is compared to that made a profit is 8.7×.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| DVNDevon Energy Corporation | $47B | 10.1× | 6.6× | 34.0% | 16.7% | 15% |
| APAAPA Corporation | $15B | 7.0× | 2.5× | 35.7% | 22.9% | 31% |
| EOGEOG Resources, Inc. | $76B | 9.3× | 4.1× | 57.2% | 28.0% | 26% |
| EXEExpand Energy Corporation | $22B | 8.1× | 3.4× | 63.5% | 20.1% | 14% |
| FANGDiamondback Energy, Inc. | $57B | 39.9× | 9.7× | 44.5% | 9.3% | 4% |
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 10.1× its last 12 months of profit (Thu 5 Nov close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now10.1×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Energy companies on the NYSE were priced at a typical 17.6× their yearly profit (Tue 27 Oct close).
- Now17.6×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $93 a share — 82% above the $50.91 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $93 | 82% above $50.91 |
| Levered | $95 | 87% above $50.91 |
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.