VDE - Devon Energy Is Great. Here's Why You Shouldn't Buy The Stock.
2023-12-15 05:10:00 ET
Devon Energy (NYSE: DVN) is an onshore U.S. energy producer with a 6.5% dividend yield. That may lead income investors to consider the stock, given that the average energy stock, using Vanguard Energy Index ETF (NYSEMKT: VDE) as a proxy, has a yield of just 3.5%. Only there's an important thing to consider about Devon Energy before you buy it if you are looking to live off of the income your portfolio generates.
One of the first things that investors need to understand about Devon Energy is that it is solely focused on the upstream portion of the oil industry. So unlike an integrated energy company such as ExxonMobil , which has assets across the energy value chain, Devon only owns oil and gas production assets. That's the upstream sector, and it means that energy prices are effectively the driving force behind the company's financial results.
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Devon Energy Is Great. Here's Why You Shouldn't Buy The Stock.