Devon Energy downgraded by RJ

[dan_s]

Raymond James analyst John Freeman and team explain why they cut Devon Energy ( DVN) to Market Perform from Outperform:

Downgrading Devon Energy to Market Perform following recent run-up in share price, catalysts largely played out: Devon has completed an impressive transformation thus far in 2016, having greatly improved liquidity on the balance sheet (undrawn revolver with $4.5 billion in cash) through the successful sale of its 50% interest in the Access Pipeline ($1 billion in proceeds) and divesting $2.1 billion in upstream assets, all while retaining its highest quality acreage. Additionally, the company reported better than expected well results in its prolific STACK acreage, largely confirming our bullish stance on the play and the company as a whole. The market took note of these positive catalysts as well, sending the stock up a whopping 120% off of the lows from February. Given the strong performance, and with the stock now bumping up against our $46 price target, we are downgrading our rating from Outperform to Market Perform, as we believe that the positive catalysts have largely played out and are now baked into the share price.
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Devon has been on a nice run and it is always nice to harvest some gains. IMO it is wise to hang on to DVN because rising natural gas and NGL prices will give their revenues and proven reserves a nice boost. Plus, well results in the STACK keep getting better. If you do want to harvest the gains, move the money to NFX for STACK. - Dan

[wilmawatts]

Moving money to NFX, thanks