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Devon Energy (DVN) Tops Q1 Earnings Estimates, Cuts '20 View

Jewel Saha
·4-min read

Devon Energy Corp. DVN reported first-quarter 2020 adjusted earnings per share of 13 cents against the Zacks Consensus Estimate of a loss of 18 cents. In the comparable year-ago quarter, the company had reported earnings of 36 cents per share.
 
Revenues

Total revenues of $2,087 million surpassed the Zacks Consensus Estimate of $1,539 million by 35.6%. Moreover, the top line improved from the year-ago figure of $1,079 million by 93.4%.

Highlights of the Release

Total net production from Devon Energy’s retained assets in first-quarter 2020 touched 348,000 barrels of oil equivalent per day (Boe/d), exceeding the guided range of 328,000-342,000 Boe/d. Oil production averaged 163,000 barrels per day, which increased 155.6% on a year-over-year basis, courtesy of strong well productivity in the Delaware Basin.

Total production expenses in the first quarter were $318 million, increasing 12.4% year over year.

Financing cost in the quarter was $65 million, up 8.3% from the year-ago period.

Devon Energy Corporation Price, Consensus and EPS Surprise

Devon Energy Corporation Price, Consensus and EPS Surprise
Devon Energy Corporation Price, Consensus and EPS Surprise

Devon Energy Corporation price-consensus-eps-surprise-chart | Devon Energy Corporation Quote

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Realized Prices

Realized oil prices in the quarter were $49.73 per barrel, down 10.4% from $55.48 in the year-ago figure. Realized prices for natural gas were down 32% to $1.57 per thousand cubic feet from $2.31 in the prior-year quarter.

Total oil equivalent realized prices — including cash settlements — were $28.63 per Boe, down 15.5% year over year.

Financial Highlights

As of Mar 31, 2020, the company had cash and cash equivalents of $1,527 million, up from $1,464 million on Dec 31, 2019. The company exited the first quarter with $4.7 billion of liquidity and no near-term debt maturities.

As of Mar 31, 2020, long-term debt amounted to $4,295 million, up from $4,294 million on Dec 31, 2019.

Devon Energy’s net cash from operating activities from continuing operations in first-quarter 2020 was $529 million, up 21.1% from the year-ago period.

The company invested $38 million to repurchase 2.2 million shares of its common stock in the early first quarter but suspended the share repurchase program to preserve liquidity amid the novel coronavirus-induced economic crisis.
 
Guidance

Devon Energy estimates total production for second-quarter 2020 in the range of 302,000-328,000 Boe/d. The same for 2020 is expected in the range of 300,000-319,000 Boe/d. The company’s existing hedges will safeguard 90% of the expected 2020 oil production of $42 per barrel.  

Capital expenditure for 2020 is expected within $950-$1,050 million, down 45% from the original guidance. For the second quarter, it anticipates to invest within $200-$2550 million.

Other Releases

National Fuel Gas Company NFG posted second-quarter fiscal 2020 operating earnings of 97 cents per share, on par with the Zacks Consensus Estimate.

TOTAL TOT reported first-quarter 2020 adjusted earnings per share of 66 cents, which beat the Zacks Consensus Estimate of 55 cents by 20%.

Occidental Petroleum Corp. OXY reported first-quarter 2020 loss of 52 cents per share, wider than the Zacks Consensus Estimate of a loss of 50 cents.

Zacks Rank

Devon Energy currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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