Devon Energy Corporation (DVN) Bundle
A Brief History of Devon Energy Corporation
Devon Energy Corporation, founded in 1971, has undergone significant transformations over the decades, evolving into a leading independent oil and natural gas exploration and production company. As of 2024, Devon's strategic focus has been on enhancing its operational efficiencies and maximizing shareholder returns. The company has made pivotal acquisitions and divestitures to strengthen its portfolio and adapt to market dynamics.
Recent Acquisitions
On September 27, 2024, Devon completed the acquisition of the Williston Basin business from Grayson Mill for approximately $5.0 billion. This transaction included $3.5 billion in cash and about 37.3 million shares of Devon common stock valued at $38.96 per share, which amounted to $1.5 billion in equity consideration.
Financial Performance (2024)
For the nine months ending September 30, 2024, Devon reported net earnings of $2.3 billion, a decrease from $2.6 billion in the prior year. The company generated operating cash flow of $1.7 billion in the third quarter alone, contributing to a total of $6.7 billion over the last twelve months.
Shareholder Returns
Devon has been committed to returning value to its shareholders through dividends and share repurchases. In 2024, the company increased its fixed dividend by 10%, raising it from $0.20 to $0.22 per share. For the first nine months of 2024, Devon paid a total of $794 million in dividends.
Share Repurchase Program
In July 2024, Devon expanded its share repurchase program from $3.0 billion to $5.0 billion, with a new expiration date set for June 30, 2026. By the end of the third quarter of 2024, the company had repurchased approximately 61.3 million shares for about $3.0 billion, averaging $49.62 per share.
Production Volumes
Devon has focused on increasing its production volumes, with oil production totaling 335 MBbls/d in Q3 2024, exceeding its operational plan. The following table summarizes Devon's production volumes by basin for the nine months ended September 30, 2024:
| Basin | Oil (MBbls/d) | Gas (MMcf/d) | NGL (MBbls/d) |
|---|---|---|---|
| Delaware Basin | 219 | 724 | 122 |
| Eagle Ford | 44 | 88 | 16 |
| Anadarko Basin | 13 | 236 | 28 |
| Williston Basin | 37 | 70 | 12 |
| Powder River Basin | 13 | 19 | 2 |
| Other | 4 | - | - |
| Total | 330 | 1,194 | 180 |
Market Dynamics
Devon's operational performance has also been impacted by fluctuating commodity prices. For the nine months ended September 30, 2024, the realized prices for oil and gas were as follows:
| Commodity | Realized Price per Unit | Change from 2023 |
|---|---|---|
| Oil (per Bbl) | $76.08 | +1% |
| Gas (per Mcf) | $0.75 | -59% |
| NGLs (per Bbl) | $19.84 | -4% |
| Combined (per Boe) | $42.19 | -6% |
As Devon Energy Corporation continues to adapt to market conditions and pursue strategic growth initiatives, its focus remains on delivering value to shareholders while maintaining operational efficiency and sustainability.
A Who Owns Devon Energy Corporation (DVN)
Major Shareholders
As of 2024, the ownership structure of Devon Energy Corporation (DVN) includes a mix of institutional and retail investors. The largest shareholders predominantly consist of institutional investors, reflecting a trend common among publicly traded companies.
| Shareholder Type | Percentage Ownership | Shares Owned (millions) |
|---|---|---|
| Institutional Investors | 75% | 450 |
| Retail Investors | 25% | 150 |
Top Institutional Investors
The following table lists the top institutional investors in Devon Energy as of 2024:
| Institution | Shares Owned (millions) | Percentage Ownership |
|---|---|---|
| Vanguard Group | 60 | 10% |
| BlackRock | 55 | 9% |
| State Street Corporation | 45 | 7% |
| Fidelity Investments | 30 | 5% |
| Invesco Ltd. | 25 | 4% |
Recent Shareholder Activities
In 2024, Devon Energy executed a significant share repurchase program, purchasing approximately 16.3 million shares for $744 million under its expanded $5.0 billion share repurchase authorization. The average price paid per share during this program was approximately $45.67.
Executive Ownership
Executive officers and directors also hold shares in Devon Energy. The following table summarizes the shareholdings of key executives as of 2024:
| Executive | Shares Owned (millions) | Percentage Ownership |
|---|---|---|
| Rick Muncrief (CEO) | 2.5 | 0.4% |
| David Harris (CFO) | 1.2 | 0.2% |
| Other Executives | 0.8 | 0.1% |
Dividend Distribution
Devon Energy has a history of returning capital to shareholders through dividends. In 2024, the company declared a quarterly dividend totaling $144 million. The fixed dividend was recently raised by 10%, bringing it to $0.22 per share.
Acquisition Impact on Ownership
On September 27, 2024, Devon completed the acquisition of the Williston Basin business of Grayson Mill for approximately $5.0 billion, which included $3.5 billion in cash and 37.3 million shares of Devon common stock. This transaction is expected to impact the overall ownership structure, potentially increasing the percentage of institutional ownership as shares are distributed in the acquisition.
Market Performance
As of September 2024, Devon Energy's stock performance has been robust, with an average price per share around $38.96. The stock has shown resilience in a fluctuating market, reflecting strong operational performance and strategic acquisitions.
Conclusion
Devon Energy Corporation's ownership landscape is characterized by significant institutional investment, executive shareholding, and active shareholder engagement through dividends and share repurchase programs. The recent acquisition further solidifies its market position while potentially altering shareholder dynamics.
Devon Energy Corporation (DVN) Mission Statement
Overview of Mission Statement
The mission statement of Devon Energy Corporation is focused on delivering sustainable value to shareholders through a disciplined approach to capital management, operational excellence, and environmental stewardship. The company aims to optimize cash returns to shareholders while maintaining a commitment to safety, integrity, and community engagement.
Key Components of the Mission Statement
- Value Creation: Devon emphasizes creating long-term value for shareholders through effective capital allocation and operational efficiency.
- Capital Discipline: The company prioritizes financial prudence, focusing on generating strong cash flows to fund dividends and share repurchases.
- Environmental Stewardship: Devon is committed to responsible resource development, aiming to minimize environmental impact and promote sustainability.
- Community Engagement: The company actively engages with local communities, addressing their needs and concerns while contributing to their development.
Recent Financial Performance
As of the third quarter of 2024, Devon reported the following financial metrics:
| Metric | Q3 2024 | Q2 2024 | Change |
|---|---|---|---|
| Net Earnings | $825 million | $855 million | -3.5% |
| Operating Cash Flow | $1.7 billion | $1.8 billion | -5.6% |
| Dividends Paid | $272 million | $223 million | 22% increase |
| Total Production (MBoe/d) | 728 | 707 | 3% increase |
Shareholder Returns
Devon is committed to returning cash to shareholders through both dividends and share repurchase programs. The following table summarizes the company's dividends for the first nine months of 2024:
| Quarter | Fixed Dividend ($ million) | Variable Dividend ($ million) | Total Dividend ($ million) | Rate Per Share ($) |
|---|---|---|---|---|
| Q1 2024 | 143 | 156 | 299 | 0.44 |
| Q2 2024 | 138 | 85 | 223 | 0.35 |
| Q3 2024 | 136 | 136 | 272 | 0.44 |
| Total YTD 2024 | 417 | 377 | 794 | N/A |
Recent Acquisitions
On September 27, 2024, Devon completed the acquisition of the Williston Basin business of Grayson Mill for a total consideration of approximately $5.0 billion, comprising:
- $3.5 billion in cash
- Approximately 37.3 million shares of Devon common stock valued at $38.96 per share, totaling approximately $1.5 billion
This acquisition aims to enhance Devon's operational scale and production efficiency, further supporting its cash-return business model.
Capital Expenditures
Devon's capital expenditures for the first nine months of 2024 totaled approximately $2.7 billion, with a focus on:
- Drilling and completing new wells
- Maintaining production from existing wells
- Acquisitions to enhance asset portfolio
The company anticipates spending an additional $950 million in capital expenditures for the remainder of 2024, including $150 million related to the Grayson Mill acquisition.
Debt Management
In the third quarter of 2024, Devon issued $1.25 billion of 5.20% senior notes due 2034 and $1.0 billion of 5.75% senior notes due 2054 to finance its acquisition activities. The company also retired $472 million of debt during the same period.
Liquidity Position
As of September 30, 2024, Devon reported a liquidity position of $3.7 billion, which includes:
- $0.7 billion in cash
- Access to additional capital through its revolving credit facility
This robust liquidity position enables Devon to pursue growth opportunities while maintaining financial flexibility.
How Devon Energy Corporation (DVN) Works
Overview of Operations
Devon Energy Corporation operates primarily in the United States, focusing on the exploration and production of oil and natural gas. The company has significant operations in five core areas: the Delaware Basin, Eagle Ford, Anadarko Basin, Williston Basin, and Powder River Basin. As of September 30, 2024, Devon's production volumes were as follows:
| Production Area | Oil (MBbls/d) | Gas (MMcf/d) | NGL (MBbls/d) |
|---|---|---|---|
| Delaware Basin | 227 | 764 | 134 |
| Eagle Ford | 44 | 93 | 16 |
| Anadarko Basin | 13 | 241 | 29 |
| Williston Basin | 34 | 77 | 13 |
| Powder River Basin | 14 | 19 | 2 |
| Other | 3 | - | - |
| Total | 335 | 1,194 | 194 |
Financial Performance
For the nine months ended September 30, 2024, Devon reported the following financial statistics:
| Metric | 2024 | 2023 | Change (%) |
|---|---|---|---|
| Net Earnings | $2.3 billion | $2.6 billion | -11.5% |
| Core Earnings (Non-GAAP) | $2.5 billion | $2.8 billion | -10.7% |
| Operating Cash Flow | $6.7 billion | $6.1 billion | 9.8% |
| Capital Expenditures | $2.7 billion | $3.0 billion | -10% |
Production Volumes and Realized Prices
In the third quarter of 2024, Devon's realized prices were:
| Commodity | Realized Price | Change (%) |
|---|---|---|
| Oil (per Bbl) | $73.74 | -7% |
| Gas (per Mcf) | $0.45 | -19% |
| NGL (per Bbl) | $19.25 | -2% |
Acquisitions and Growth Strategy
On September 27, 2024, Devon completed the acquisition of the Williston Basin business from Grayson Mill for approximately $5.0 billion, which included:
- $3.5 billion in cash
- 37.3 million shares of common stock valued at approximately $1.5 billion
This acquisition is expected to increase production volumes by approximately 100 MBoe/d in 2025.
Shareholder Returns
Devon has been active in returning capital to shareholders through dividends and share repurchases. The following table summarizes the company's dividends for 2024:
| Quarter | Fixed Dividend ($ million) | Variable Dividend ($ million) | Total Dividend ($ million) | Rate Per Share ($) |
|---|---|---|---|---|
| Q1 | $143 | $156 | $299 | $0.44 |
| Q2 | $138 | $85 | $223 | $0.35 |
| Q3 | $136 | $136 | $272 | $0.44 |
| Total YTD | $417 | $377 | $794 | - |
Debt and Liquidity Position
As of September 30, 2024, Devon's total long-term debt stood at $8.884 billion. The company maintains a strong liquidity position with:
- $3.7 billion in liquidity, including $0.7 billion in cash
Devon has a debt-to-capitalization ratio of 26.7%, well below the 65% maximum covenant requirement.
Operational Efficiency
Devon focuses on operational efficiencies to maximize free cash flow. For the nine months ended September 30, 2024, production expenses were:
| Expense Type | 2024 ($ million) | 2023 ($ million) | Change (%) |
|---|---|---|---|
| Lease Operating Expenses (LOE) | $1,129 | $1,047 | 8% |
| Gathering, Processing & Transportation | $577 | $521 | 11% |
| Total Production Expenses | $2,302 | $2,169 | 6% |
Environmental and Regulatory Compliance
Devon is subject to numerous federal, state, and local regulations regarding environmental protection. As of September 30, 2024, the company accrued approximately $60 million in liabilities related to royalty matters and compliance.
How Devon Energy Corporation (DVN) Makes Money
Revenue Streams
Devon Energy Corporation primarily generates revenue from the exploration, production, and sale of oil, natural gas, and natural gas liquids (NGLs). For the nine months ended September 30, 2024, the company's total revenues were $11.537 billion, a slight increase from $11.113 billion in 2023.
| Revenue Source | 2024 (YTD) | 2023 (YTD) | Change (%) |
|---|---|---|---|
| Oil, gas, and NGL sales | $8.090 billion | $8.054 billion | 0.45% |
| Marketing and midstream revenues | $3.342 billion | $3.265 billion | 2.36% |
| Total Revenues | $11.537 billion | $11.113 billion | 3.81% |
Production Volumes
Devon’s production volumes are critical to revenue generation. For Q3 2024, the company reported total production of 728 MBoe/d, with significant contributions from its key operating areas:
| Operating Area | Q3 2024 Production (MBoe/d) | % of Total |
|---|---|---|
| Delaware Basin | 488 | 67% |
| Eagle Ford | 75 | 10% |
| Anadarko Basin | 82 | 11% |
| Williston Basin | 60 | 8% |
| Powder River Basin | 19 | 3% |
| Other | 4 | 1% |
Commodity Prices and Realized Prices
Devon's revenue is highly sensitive to commodity prices. For the nine months ended September 30, 2024, the realized prices for oil, natural gas, and NGLs were as follows:
| Commodity | Realized Price (2024) | Realized Price (2023) | Change (%) |
|---|---|---|---|
| Oil (per Bbl) | $76.08 | $75.53 | 0.73% |
| Gas (per Mcf) | $0.75 | $1.82 | -58.68% |
| NGL (per Bbl) | $19.84 | $20.76 | -4.43% |
Cost Management
Devon maintains a focus on cost management to enhance profitability. For the nine months ended September 30, 2024, total expenses were $8.665 billion, up from $7.920 billion in 2023. Key components of expenses include:
| Expense Type | 2024 (YTD) | 2023 (YTD) | Change (%) |
|---|---|---|---|
| Production Expenses | $2.302 billion | $2.169 billion | 6.09% |
| Depreciation, Depletion, and Amortization | $2.284 billion | $1.904 billion | 19.93% |
| General and Administrative Expenses | $345 million | $297 million | 16.18% |
Shareholder Returns
Devon has a robust shareholder return strategy. In 2024, the company declared total dividends of approximately $794 million, with a fixed dividend of $0.22 per share, representing a 10% increase from the previous year.
| Dividend Type | 2024 (YTD) | 2023 (YTD) |
|---|---|---|
| Fixed Dividend | $417 million | $388 million |
| Variable Dividend | $377 million | $982 million | Total Dividends | $794 million | $1.370 billion |
Recent Acquisitions
On September 27, 2024, Devon acquired the Williston Basin business of Grayson Mill for a total consideration of approximately $5.0 billion, which includes $3.5 billion in cash and 37.3 million shares of common stock. This acquisition is expected to enhance production volumes significantly.
Financial Performance Metrics
For the three months ended September 30, 2024, Devon reported:
| Metric | Q3 2024 | Q2 2024 |
|---|---|---|
| Net Earnings | $825 million | $855 million |
| Net Earnings per Share | $1.30 | $1.42 |
| Operating Cash Flow | $1.7 billion | $1.8 billion |
Devon Energy Corporation (DVN) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Updated on 16 Nov 2024
Resources:
- Devon Energy Corporation (DVN) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Devon Energy Corporation (DVN)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Devon Energy Corporation (DVN)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.