Devon Energy vs Occidental Petroleum Which Is a Better Investment?

Devon Energy and Occidental Petroleum are two major players in the energy sector, each with their own unique strengths and challenges. Devon Energy primarily focuses on producing oil and natural gas, while Occidental Petroleum has a more diversified portfolio that includes chemical manufacturing and midstream assets. Investors looking to capitalize on the energy market may find opportunities in both stocks, but must carefully weigh the risks and potential rewards associated with each company's growth strategies and financial performance.

Devon Energy or Occidental Petroleum?

When comparing Devon Energy and Occidental Petroleum, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Devon Energy and Occidental Petroleum.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Devon Energy has a dividend yield of 6.26%, while Occidental Petroleum has a dividend yield of 2.52%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Devon Energy reports a 5-year dividend growth of 57.09% year and a payout ratio of 37.66%. On the other hand, Occidental Petroleum reports a 5-year dividend growth of -25.32% year and a payout ratio of 29.74%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Devon Energy P/E ratio at 7.12 and Occidental Petroleum's P/E ratio at 9.82. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Devon Energy P/B ratio is 1697.35 while Occidental Petroleum's P/B ratio is 1.42.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Devon Energy has seen a 5-year revenue growth of 0.10%, while Occidental Petroleum's is 0.36%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Devon Energy's ROE at 37.01% and Occidental Petroleum's ROE at 15.10%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $38.36 for Devon Energy and $49.93 for Occidental Petroleum. Over the past year, Devon Energy's prices ranged from $37.77 to $55.09, with a yearly change of 45.86%. Occidental Petroleum's prices fluctuated between $49.51 and $71.19, with a yearly change of 43.79%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.