Like other energy companies, Devon Energy (DVN) had a great run this past year. Earnings growth, for example, ranged up to 999%. On Tuesday the Relative Strength (RS) Rating for Devon stock jumped 12 points into a higher percentile as it got a lift from 63 to 75. The question now is: Can it do it again this year after oil prices have come down from last summer’s highs?
The 75 RS Rating puts Devon stock in the top 25% of all stocks, regardless of industry, for price performance. It’s fast closing on a key benchmark that delineates the best stocks to buy and watch. An RS Rating north of 80 in the early stages of their moves is an indicator that a stock is likely to see a strong rise. See if Devon Energy can continue to rebound and clear that threshold.
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Devon Stock In Top 10% Of Stocks Overall
Among its other key ratings, Oklahoma City-based Devon has a decent 79 Earnings Per Share Rating, out of 99. Devon stock also sports a 90 Composite Rating, putting it in the top 10% of stocks on a group of key metrics. Even better, it carries an A SMR Rating (sales+profit margins+return on equity) on an A-to-E scale with A being superb. Its one yellow flag is a D- Accumulation/Distribution Rating, which indicates that institutional investors such as mutual funds and insurance company funds are selling more shares than buying for now.
One reason for the hesitancy by big money could be that, although the watchlist candidate is still putting up strong numbers, its sales and profit growth slowed from earlier, heady gains last year.
Devon stock is not currently offering a proper buying opportunity although it’s soared the last couple of years. See if the stock goes on to build a sound pattern that could ignite a fresh run. Its stock plunged to 4.70 a share in late March 2020 amid the Covid market crash. It closed above 63 Tuesday, up 1.5% for the day.
Profit Growth Soared
Devon Energy showed 102% EPS growth in the latest quarterly report, to $2.18. The prior three periods its EPS grew more than 999%, 318% and then 322%. Revenue rose 57% to $5.43 billion last quarter.
Devon stock holds the No. 17 rank among its peers in the Oil&Gas-U.S. Exploration & Production industry group. Diamondback Energy (FANG) and HighPeak Energy (HPK) are among the group’s highest-rated stocks.
IBD’s proprietary Relative Strength Rating identifies market leadership with a 1 (worst) to 99 (best) score. The score shows how a stock’s price behavior over the last 52 weeks compares to all the other stocks in our database.
Please follow James DeTar on Twitter @JimDeTar
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