Mr. O’Rourke focused on five equities that he sees having “unique” investment thesis, raising their target prices:

* Whitecap Resources Inc. (“outperform”) to $11.25 from $10.75. Average: $10.59.

“WCP offers the highest return, across our E&P coverage, to our intrinsic NAV based target, at 60 per cent,” he said. “WCP’s CF generation is supported throughout the commodity cycle, by its peer leading corporate decline of 20 per cent (excluding the oil sands group), which it expects to maintain in 2022. WCP currently offers a 3.8-per-cent dividend yield, with a 2022e total payout of 45 per cent vs the peer group average of 47 per cent.”

* Cenovus Energy Inc. ( “outperform”) to $22 from $19.50. Average: $19.69.

“CVE currently offers the second highest upside, of the oil sands group, to our intrinsic NAV based price target, at 44 per cent, while we see an average upside of 31 per cent for the group, a key driver of our outperform rating. The focus on Cenovus’ merger with Husky was on improving market access and integrating its operations from the wellhead to the refinery. Cenovus is now focused on the $1.2-billion in identified cost structure savings and the project high gradings that were laid out in the merger announcement, and given the confidence and execution that CVE has been conveying, we believe there is further potential upside, though broader economic inflationary pressures may limit that.” In addition, we continue to believe there is plenty of opportunity to improve upon the prior existing and Husky acquired assets (most visibly through the margin enhancing integration of Foster Creek/Christina with Husky’s Lloydminster upgrader). Finally, we believe that CVE is also best positioned for asset rationalization that accelerates debt repayment and the path to shareholder returns relative to peers, with the obvious focus being the Deep Basin and retail assets (while the Company clearly alluded to the potential for other asset sales on recent investor calls.”

Mr. O’Rourke’s other changes included:

  • Arc Resources Ltd. ( “outperform”) to $16.75 from $15.75. The average on the Street is $18.07.
  • Enerplus Corp. ( “outperform”) to $15 from $12.25. Average: $15.25.
  • Tourmaline Oil Corp. ( “outperform”) to $60 from $55. Average: $57.83.