Devon Energy (DVN) Stock Down, Deutsche Bank Increases Price Target
NEW YORK (TheStreet) -- Shares of Devon Energy (DVN) - Get Report are down 4.65% to $35.71 in early afternoon trading, even though the company's price target was raised this morning to $45 from $41 at Deutsche Bank.
The price change comes after the increasing attractiveness of the crude market, as well as Devon Energy's "better than expected" execution on asset sales, according to an analyst note.
The Oklahoma City-based oil and natural gas exploration and production company is also "the largest beneficiary of the next $10/bbl move in crude, increasing cash flow by 45%" and has "advantaged exposure to top 'rate of change' plays in the Delaware Basin and STACK," Deutsche wrote.
Additionally, the firm maintained its "buy" rating for Devon.
Deutsche believes the company can overcome "the overhang of debt and legacy cost structure" in the market and become an "eventual bull case of $69/share."
"After aggressively overhauling its portfolio over the past three years, we view DVN as holding one of the deepest, highest quality, and still underappreciated asset portfolios among our E&P coverage," Deutsche wrote in an analyst note.
WTI crude is decreasing 5.27% to $46.41 per barrel on the New York Mercantile Exchange, while Brent crude is decreasing 4.95% to $47.62 per barrel on the Intercontinental Exchange this afternoon.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate DEVON ENERGY CORP as a Sell with a ratings score of D. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself and generally high debt management risk.
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