Buying Devon Energy (DVN)

Just took advantage of this market drop to buy Devon Energy (DVN) at $56.75. Market action feels like stocks could drop further but I’m less concerned about timing than insuring I get these shares selling too cheaply. Hopefully it does drop further so I can average down into a large position.

I briefly laid out my case for DVN in this article here. Both DVN and Talisman Energy (TLM) look cheap right now but two reasons stand out for picking Devon Energy:

  1. Shares look more undervalued relative to its proven resource base.
  2. Devon is historically much-better run from an operations standpoint.
  3. TLM resembles Chesapeake Energy (CHK) in its financial structure (but without the standout operations team). CHK preferred D shares already comprises a large chunk of my equity portfolio and made little sense to buy “CHK Jr.”, if you will.

Read more about “2 Energy Stock Alternatives To Chesapeake Energy.”

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