Jim Cramer Recently Discussed These 7 Stocks

5. Devon Energy Corporation (NYSE:DVN)

Number of Hedge Fund Holders: 41

Commenting on Devon Energy Corporation (NYSE:DVN), Cramer said, “I like Devon, but I think Coterra is far superior to Devon.”

Devon Energy (NYSE:DVN) is an independent energy company involved in the exploration, development, and production of oil, natural gas, and natural gas liquids across the United States. On November 7, Truist downgraded the company stock to Hold from Buy, setting a price target of $43, down from $49, following the company’s better-than-expected results and in-line guidance.

According to the analyst, the revised EBITDAX trading multiple and free cash flow yield suggest limited upside potential for the stock. While the company continues to indicate a significant inventory of assets, the analyst believes the company needs to expand its inventory to compete among the top large-cap exploration and production companies.

It is noteworthy that Devon Energy (NYSE:DVN) has made a deliberate decision to focus investments on its core assets in the Delaware Basin to boost productivity. This move has proven successful, with the company initially projecting production of 650,000 barrels of oil equivalent per day (BOED) for the year. However, by August, management revised this estimate upwards to a range of 677,000 BOED to 688,000 BOED.

As of November, the target was further increased to between 811,000 BOED and 830,000 BOED, reflecting a significant rise of 110,000 BOED from the acquisition of assets in the Williston Basin. This focus on improving productivity in the Delaware Basin has yielded clear results, with production from this region, reaching 488,000 BOED in the third quarter of 2024, and accounting for 67% of company-wide volumes.