Nucor earnings beat by $0.08, revenue fell short of estimates
OKLAHOMA CITY - Devon Energy Corp. (NYSE: DVN), currently valued at $19.12 billion, announced today a comprehensive business optimization plan aimed at improving margins and capital efficiency, with the goal of increasing pre-tax free cash flow by $1 billion annually by the end of 2026. The plan is expected to deliver 30% of its targeted improvements by the end of 2025. According to InvestingPro data, 12 analysts have recently revised their earnings expectations upward for the upcoming period, suggesting growing confidence in the company’s strategic direction. The stock currently appears undervalued based on InvestingPro’s Fair Value analysis.
Clay Gaspar, the president and CEO of Devon Energy, stated, "This milestone reflects the commitment, ingenuity, and talent of our employees, whose hard work and ongoing efforts continue to drive Devon’s success." He emphasized the strategic timing of the initiative, which coincides with recent leadership changes and a challenging market environment. Gaspar expressed confidence in the company’s ability to execute the plan effectively.
The optimization strategy focuses on several key areas, including capital efficiency, production optimization, commercial opportunities, and corporate cost reductions. Devon expects to save $300 million through design optimization, cycle time reductions, and improved vendor management. Another $250 million is anticipated from utilizing advanced analytics to optimize production and operating costs. Enhancing commercial contracts is projected to yield an additional $300 million, while corporate cost structure streamlining aims to cut $150 million.
Devon has already secured marketing agreements expected to contribute materially to margin improvement through 2026. Additionally, the company has integrated technological advancements, such as advanced analytics and process automation, to bolster operating performance. These measures are projected to result in approximately $300 million of cash flow uplift by the end of 2025.
Further details about the business optimization plan will be disclosed during Devon Energy’s first-quarter 2025 earnings conference call on Wednesday, May 7, 2025. The company has also provided a supplemental presentation on its website.
Devon Energy is recognized as a leading oil and gas producer in the U.S., especially noted for its position in the Delaware Basin. The company’s business model focuses on generating strong returns, free cash flow, and returning capital to shareholders while maintaining safe and sustainable operations. Notable is the company’s 33-year track record of consistent dividend payments, with a current yield of 3.7%. InvestingPro subscribers can access detailed analysis of Devon’s financial health, which currently rates as "GOOD" based on comprehensive metrics, along with additional exclusive insights available in the Pro Research Report.
This news is based on a press release statement from Devon Energy Corporation. The forward-looking statements in the press release are subject to various risks, including the possibility that the company may not achieve the improvements on the anticipated timeline or at all.
In other recent news, Devon Energy has been the subject of several analyst assessments and corporate developments. Benchmark analysts maintained a Buy rating with a $44 price target, projecting first-quarter earnings per share (EPS) of $1.33 and earnings before interest, taxes, depreciation, and amortization (EBITDA) of $2.16 billion, which are above consensus estimates. Meanwhile, BMO Capital Markets reiterated an Outperform rating with a $52 price target, highlighting Devon Energy’s strong operational performance and financial position. Citi analyst Scott Gruber adjusted Devon Energy’s price target to $43, maintaining a Buy rating, while noting a temporary production decline in the Eagle Ford region. Mizuho Securities also revised its price target to $46, continuing to rate the stock as Outperform, citing expectations for the company’s performance through 2025.
Additionally, Devon Energy announced the upcoming retirement of board member John Krenicki Jr., who will not seek re-election at the 2025 annual meeting. This decision was reported in a recent SEC filing and is not related to any disagreements with the company’s policies or practices. The company has not disclosed any immediate plans for filling the board vacancy. These recent developments reflect ongoing adjustments and strategic planning within Devon Energy as it navigates market conditions and leadership changes.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.