Top PickTwo days ahead of the original BNN schedule; last stock in the clip. It's the only one of his top picks that he also owns personally. GLTA https://www.bnnbloomberg.ca/video/eric-nuttall-s-top-picks~2813146 Cenovus (CVE TSX)
Cenovus has been relentlessly trying to get to their ultimate $4 billion debt target which will trigger 100 per cent of free cash flow being returned to shareholders, and while this has taken about a year longer than expected due to weaker-than-expected oil pricing and downstream challenges, we see this milestone being reached at the end of the first quarter of 2024. Trading at a 16 per cent free cashflow yield at $80 WTI we see the potential for meaningful share buybacks to re-rate the stock from its current trading multiple of 4.1 times. We have a target multiple of six times = 10 per cent FCF yield at $80 WTI = $37.40 share price.
TOP PICK
Cenovus Energy(CVE-T)
22/11/2023
Debt drawdown taking longer than thought due to weaker oil. Other issues have been fixed. Waiting to hit $4B of debt, and he sees it happening in Q2. Shareholders should be getting 100% of free cashflow early next year. Sees 40-80% upside. 35 years of inventory. Solid, steady CEO. High-quality reservoirs. Yield is 2.34%.
(Analysts’ price target is $33.19)
Oil / Gas
Eric Nuttall
$23.940
Owned