This Ultra-High-Yield Dividend Stock Takes Another Page Out of Devon Energy's Playbook

Devon Energy (NYSE: DVN) launched a pioneering capital return framework following its transformational merger with WPX Energy in early 2021. It established the industry's first fixed-plus-variable dividend policy. The framework featured a fixed base quarterly dividend and a variable dividend of up to 50% of its free cash flow.

Several oil stocks have since taken a page from Devon Energy's playbook by launching similar fixed-plus-variable dividend policies, including Chord Energy (NASDAQ: CHRD). That oil producer is now taking another page out of Devon's playbook by agreeing to acquire (NYSE: ERF), a company Devon had also offered to buy. Here's a look at how the deal will benefit dividend investors and where Devon might turn next to fuel its payout.

Chord Energy is acquiring Enerplus in a cash-and-stock deal, valuing the target at about $3.9 billion (including the assumption of debt). It's paying 90% of the $3.4 billion equity value in stock (0.10125 of its shares for each share of Enerplus) and the other 10% in cash ($1.84 per share). The transaction will create an $11 billion oil and gas company by enterprise value.

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Source Fool.com