Devon Energy: 2Q26 Preview: Anticipating Slight Oil Beat and Upside EBITDA as Merger Integration on Track

Research evidence excerpt

Devon Energy: 2Q26 Preview: Anticipating Slight Oil Beat and Upside EBITDA as Merger Integration on Track

J P M O R G A N North America Equity Research

08 July 2026

Devon Energy Overweight

DVN, DVN US

2Q26 Preview: Anticipating Slight Oil Beat and Upside Price (07 Jul 26):$42.41

EBITDA as Merger Integration on Track ▼Price Target (Dec-26):$55.00 Prior (Dec-26):$62.00

JPM View: Since the DVN/CTRA merger was announced in early February, DVN

shares have lagged large-cap E&P peers (EOG, FANG, and OXY) by ~9%, which we Oil & Gas Exploration & Production

believe reflects investor uncertainty around the go-forward portfolio and some sticker Arun Jayaram AC

shock from the recent federal lease sale in 2Q26. We believe the management team (1-212) 622-8541

has been appropriately focused on re-educating the market following the early-May arun.jayaram@jpmchase.com

merger close, particularly around the pro forma size, scale, and quality of the Pankaj Bhatter, CFA

company’s Delaware Basin franchise asset, which DVN argues is the highest-quality (1-212) 622-3795

pankaj.bhatter@jpmchase.com

position in the industry. In the near term, we expect management to remain laser

Jack Jerusalmi

focused on integrating the CTRA assets, while also moving expeditiously through the

(1-212) 622-6552

strategic portfolio review, which management has framed as a months-long exercise jack.jerusalmi@jpmorgan.com

rather than a year-long one. Importantly, DVN remains confident in delivering its J.P. Morgan Securities LLC

$1.0bn synergy target by YE27, and we expect tangible progress towards that target

to be a key focal point on the 2Q26 print. We continue to believe that the stock provides

an attractive entry point given the compelling absolute and relative valuation Key Changes (FYE Dec)