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 ( TheStreet) -- Devon Energy (NYSE: DVN) has been reiterated by TheStreet Ratings as a hold with a ratings score of C+ . The company's strengths can be seen in multiple areas, such as its expanding profit margins, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and a generally disappointing performance in the stock itself.
- EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stocks Under $10 that he thinks could potentially double. See what he's trading today with a 14-day FREE pass
- The gross profit margin for DEVON ENERGY CORP is rather high; currently it is at 67.90%. Regardless of DVN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, DVN's net profit margin of 18.60% significantly outperformed against the industry.
- Despite currently having a low debt-to-equity ratio of 0.48, 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 1.63 is high and demonstrates strong liquidity.
- DVN, with its decline in revenue, underperformed when compared the industry average of 0.7%. Since the same quarter one year prior, revenues fell by 20.5%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- Net operating cash flow has declined marginally to $1,426.00 million or 8.00% when compared to the same quarter last year. Despite a decrease in cash flow of 8.00%, DEVON ENERGY CORP is in line with the industry average cash flow growth rate of -13.47%.
- 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 82.6% when compared to the same quarter one year ago, falling from $2,743.00 million to $477.00 million.
--Written by a member of TheStreet Ratings Staff.FREE for a limited time only: Get TheStreet Ratings #1 Stock Report NOW!