Devon Energy’s (DVN, $29.81) shares soar after announcing Canadian asset sales
Shares of Devon Energy soared as much as 15% to its highest in three months, after the company announced the sale of its Canadian and Barnett Shale assets and raised its dividend.
Analysts are divided in their opinions regarding the exact value of the Canadian asset sales. Some think they could sell for $3.5 - $5 billion, while others think they could sell even higher at $7 - $9 billion.
However, analysts are also not certain how resourceful these divestments are going to be in the long run. This uncertainly is due the fact that Alberta is currently facing forced production curbs designed to draw down a crude oil glut, coupled with a lack of long-term pipeline takeaway capacity in western Canada.
Canadian oil sands companies like Imperial Oil, Canadian Natural, Husky Energy, and Suncor Energy are the usual suspects according to analysts to make purchases of DVN’s assets. But DVN's preference for cash to pay down debt may make a Husky an uncertain buyer.
IMO could also be a likely buyer since DVN’s assets could help it improve heavy oil prices.
DVN's MACD Histogram just turned positive
The Moving Average Convergence Divergence (MACD) for DVN turned positive on May 22, 2023. Looking at past instances where DVN's MACD turned positive, the stock continued to rise in of 44 cases over the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where DVN's RSI Oscillator exited the oversold zone, of 31 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
The Momentum Indicator moved above the 0 level on May 24, 2023. You may want to consider a long position or call options on DVN as a result. In of 98 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where DVN advanced for three days, in of 315 cases, the price rose further within the following month. The odds of a continued upward trend are .
DVN may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Bearish Trend Analysis
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In of 70 cases where DVN's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are .
DVN moved below its 50-day moving average on May 02, 2023 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for DVN crossed bearishly below the 50-day moving average on May 05, 2023. This indicates that the trend has shifted lower and could be considered a sell signal. In of 14 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where DVN declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for DVN entered a downward trend on May 25, 2023. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Fundamental Analysis (Ratings)
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (2.810) is normal, around the industry mean (5.972). P/E Ratio (5.241) is within average values for comparable stocks, (16.691). Projected Growth (PEG Ratio) (1.479) is also within normal values, averaging (55.823). Dividend Yield (0.105) settles around the average of (0.089) among similar stocks. P/S Ratio (1.630) is also within normal values, averaging (155.317).
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 79, placing this stock slightly better than average.
The Tickeron Seasonality Score of (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. DVN’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
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The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
