Jefferies Upgrades Devon Energy to Buy, Sets $62 Target

CNBC reported Friday that Jefferies has issued a Devon Energy upgrade, lifting its rating on the oil and gas producer to buy from hold. The investment bank also pushed its price target to $62 from $53, implying roughly 37% upside from where shares closed on Thursday.

Merger Close Fuels the Bull Case

Analyst Lloyd Byrne of Jefferies wrote in a Thursday client note that Devon trades at a significant valuation discount and carries a stack of upcoming catalysts. Near-term weakness in oil futures, he argued, actually creates a buying opportunity rather than a reason to exit. Devon’s forward price-to-earnings ratio sits around 8.28, according to FactSet data. That compares sharply with the S&P 500’s multiple of more than 21.

A central driver of the upgrade is the completed merger with Coterra Energy, which closed this week. Jefferies estimates the combination will generate approximately $1 billion in synergies. Byrne believes that figure will provide a meaningful lift to Devon’s share price once the market fully digests the deal.

Background: Devon’s Strong Year-to-Date Run

Devon shares have already climbed around 24% so far in 2026, outpacing many of its exploration and production peers. The stock has held up even as U.S. West Texas Intermediate crude futures slid nearly 7% over the past week, with WTI last quoted near $94.94 per barrel. The recent oil weakness has been linked to diplomatic developments between the U.S. and Iran, which have introduced uncertainty around supply risk premiums. Futures contracts for later delivery also point to further pressure ahead.

Asset Sales Could Further Strengthen the Balance Sheet

Beyond the merger synergies, Jefferies flagged potential divestitures of non-core holdings as another upside lever. Devon’s Marcellus Shale position, in particular, was highlighted as an asset the company could sell to reduce debt and sharpen its return profile. Such a move would focus the company more tightly on its core Basin operations and improve capital efficiency.

Wall Street Broadly Aligned With the Call

The Devon Energy upgrade from Jefferies lands in line with the broader analyst community. Among 28 analysts currently covering Devon, 24 carry either a buy or strong buy rating on the stock, according to LSEG data. That near-consensus bullish positioning suggests institutional confidence in Devon’s trajectory even against a softer commodity backdrop.

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