Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
-- Devon Energy
) has been reiterated by TheStreet Ratings as a hold with a ratings score of C . Among the primary strengths of the company is its solid financial position based on a variety of debt and liquidity measures that we have evaluated. At the same time, however, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income.
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Highlights from the ratings report include:
- Despite currently having a low debt-to-equity ratio of 0.52, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that DVN's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.59 is high and demonstrates strong liquidity.
- The revenue fell significantly faster than the industry average of 7.2%. Since the same quarter one year prior, revenues fell by 46.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Net operating cash flow has declined marginally to $1,361.00 million or 3.06% when compared to the same quarter last year. Despite a decrease in cash flow DEVON ENERGY CORP is still fairing well by exceeding its industry average cash flow growth rate of -15.41%.
- DEVON ENERGY CORP has exprienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, DEVON ENERGY CORP reported lower earnings of $5.13 versus $5.26 in the prior year. For the next year, the market is expecting a contraction of 36.1% in earnings ($3.28 versus $5.13).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 169.3% when compared to the same quarter one year ago, falling from $1,038.00 million to -$719.00 million.
Devon Energy Corporation, an independent energy company, engages primarily in exploration, development, and production of oil, natural gas, and natural gas liquids. Devon Energy has a market cap of $21.43 billion and is part of the basic materials sector and energy industry. The company has a P/E ratio of 31.1, above the S&P 500 P/E ratio of 17.7. Shares are down 15.6% year to date as of the close of trading on Thursday.
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--Written by a member of TheStreet Ratings Staff.
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