UBS Reiterates Sell on Devon Energy (DVN) - PT to $35

UBS reiterated a Sell rating on Devon Energy (NYSE: DVN), and raised the price target to $35.00 (from $32.00), following the company's 3Q earnings report. DVN reported a $0.03 EPS beat, driven by lower than expected costs & higher oil price realizations. DVN's 4Q16 production guidance of 524-546 MBoed is below consensus of ~553 MBoed.

Analyst William Featherston commented, "Clean 3Q EPS of $0.09 was above consensus & our estimate of $0.06 with the beat vs. UBSe driven by lower than expected costs & higher oil price realizations; however, CFPS of $0.81 was below our $0.84 on lower DD&A. EBITDX of $703MM exceeded consensus of $692MM. Core 3Q volumes (adjusted for divested assets) were down ~7% YoY to 550 MBoed while total production was down 15% YoY to 577 MBoed, in line with the 560-590 MBoed guidance range but below UBSe/consensus of ~582/581 MBoed. Price realizations fell 31% YoY to $3.68/Mcfe, 8% above UBSe. Unit costs fell 16% YoY to $3.78/Mcfe, 2% below our forecasts."

For an analyst ratings summary and ratings history on Devon Energy click here. For more ratings news on Devon Energy click here.

Shares of Devon Energy closed at $37.69 yesterday.

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