Jim Cramer Says Buy These 5 Industrial Stocks Before Rate Cuts — And 5 Other Stocks He’s Talking About

4. Devon Energy Corp (NYSE:DVN)

Number of Hedge Fund Investors: 52

When asked about Devon Energy Corp (NYSE:DVN), Jim Cramer said that Rick Muncrief (Devon CEO) has “put together a monster company.” Cramer recommended the stock with caution amid volatility in oil and gas prices.

“So, I’d own Devon Energy Corp (NYSE:DVN) but don’t get too excited.”

Upstream energy giant Devon Energy Corp (NYSE:DVN) is a notable dividend stock popular among hedge funds. During the first quarter, the company’s production beat its guidance by 4%, driven by strong activity in the Delaware Basin. Devon’s FCF hit $844 million, representing its 15th consecutive quarter of strong FCF generation. Devon Energy Corp (NYSE:DVN) also increased its 2024 production guidance to about 665 thousand barrels/day. Devon Energy Corp (NYSE:DVN) is allocating a whopping 30% of the FCF for shareholder returns, with a $3 billion share buyback authorization in place. Analysts believe Devon Energy Corp (NYSE:DVN)’s low net debt-to-EBITDAX of 0.7x and high growth estimates make it an undervalued play.

Devon Energy Corp (NYSE:DVN) is currently trading at a P/E multiple of 8.9,  lower than Devon Energy Corp’s (NYSE:DVN) five-year average P/E of 10.84 as well as the industry mean of 10.73. Wall Street analysts have an average price target of $58.45 for Devon Energy Corp (NYSE:DVN), about 20% higher than the stock’s current levels.  Devon Energy Corp (NYSE:DVN) has a $3 billion share buyback authorization in place, which is about 10% of its outstanding shares. In the first quarter alone Devon Energy Corp (NYSE:DVN) returned $430 million to shareholders through dividends and buybacks.