Centre Ben John signs a new two-year contract to stay with the Ospreys until the summer of 2016.
John, 23, has been capped at all Wales age-grade levels and went to the 2010 Junior World Championships in Argentina.
He made his Ospreys debut in 2010 after he has scored seven tries in 57 matches for Aberavon in the Welsh Premiership.,
"I believe it's the right decision for me, the only decision really," said Davies.
"This is my home region and I love it here. It's the team I've always wanted to play for and I'm fortunate enough to have learned so much in this environment.
"2013 was huge for me, a massive learning curve. I've been able to get some great experience over the last year and this season I've been able to play more at centre, which I've really enjoyed.
"Now I've managed that, I want to push on and improve as a player, improve in that position, and really establish myself.
"There are some very good centres in the squad who all seem to be playing really well.
"It's good for my development that they have different strengths, which allows me to pick up different things, but now I want to challenge for a place regularly."
John made his Heineken Cup debut out in Treviso in 2013.
He has now made 33 Ospreys appearances, scoring three tries, with 17 of those games coming this season.
His last appearance was in the Heineken Cup defeat out in Leinster in January, where he suffered nerve damage to his shoulder, and he is targeting a return to action in the final month of the season.