Unusual Options Activity In Devon Energy Corporation

Devon Energy Corporation, an independent energy company, primarily engages in the exploration, development, and production of oil, natural gas, and natural gas liquids in the United States and Canada.  One of the smartest things Devon Energy did years ago when natural gas prices were depressed and stayed depressed was get rid of his natural gas land reserves and invest in more oil land reserves.

But then they did something even smarter, they invested in the right oil land reserves which consist of: the Delaware Basin, the Powder River Basin and the Eagle Ford Shale. 

Thus, as long as oil prices stay above $46, Devon will remain a cash cow generating significant free cash flow.  

In January, the Smart Money bought the 10,000 of the April $28 strike price calls for $1.50 when Devon was trading at $25.  Those calls were later sold for $2.50. Today, the Smart Money bought over 15000 of the July $33 strike call options. 

And it appears they have been building a position already in the July $34 strike call options.

With oil making 2019 yesterday and with the start of Summer fast approaching, I suspect Devon to continue to rise along with oil.  Thus, the chart suggests 

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

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