Devon Energy shares up as analyst keeps top rating

The stock jumped $4.49, or 4.6 percent, to end at $103.06.

Friedman, Billings, Ramsey analyst Rehan Rashid said the Oklahoma City-based company could post a buyback or boost its production guidance when second-quarter results are released.

Rashid kept an "Outperform" rating and $140 price target, implying he expects the stock to jump 42 percent over Friday's $98.57 close.

The company likely will have $2.1 billion, after taxes, from the sale of African properties and $2.1 billion in free cash to use, Rashid said.

With exploration and development capital expenditures constrained for the rest of the year, and with a "relatively low" leverage, Devon Energy may move to buy back 5 percent of shares, he said.

The company's production growth profile could strengthen, said Rashid, who currently expects 2008 and 2009 production to grow 12 percent, year over year.

Meanwhile, light, sweet crude for August delivery rose $2.16 to $131.04 on the New York Mercantile Exchange.

So far this year, shares have rise about 11 percent. Final second-quarter results are scheduled to be released August 6.