Development Spending Will Boost Output

Article Excerpt

DEVON ENERGY CORP. $83.43 (New York symbol DVN; SI Rating: Speculative) (405-235-3611;; Shares outstanding: 445.9 million; Market cap: $37.2 billion) is one of the largest U.S.-based independent oil and gas explorers and producers. Devon’s properties are located mainly in the United States and Canada and, to a lesser degree, various regions outside North America, including Azerbaijan, Brazil, China and Russia. The company is now selling its assets in Egypt and West Africa for an estimated $2 billion. Devon’s midstream operations include pipelines, storage and treatment facilities and gas processing plants. It also markets natural gas and crude oil. Cash flow keeps growing In the three months ended June 30, 2007, Devon’s revenues rose 24.6%, to $2.93 billion from $2.35 billion. Cash flow rose 22.1%, to $1.69 billion, or $3.80 a share, from $1.39 billion or $3.15 a share. Devon’s shares trade at 5.5 times cash flow. Long-term debt of $5.6 billion is equal to 28% of shareholders’ equity. Devon also holds cash of…

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