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Cenovus Energy Inc T.CVE

Alternate Symbol(s):  CVE | CVE.WS | T.CVE.WT | T.CVE.PR.A | CNVEF | T.CVE.PR.B | T.CVE.PR.C | T.CVE.PR.E | T.CVE.PR.G

Cenovus Energy Inc. is a Canada-based integrated energy company. The Company has oil and natural gas production operations in Canada and the Asia Pacific region, and upgrading, refining and marketing operations in Canada and the United States. The Company's segments include Upstream, Downstream, and Corporate and Eliminations. Its Upstream segment includes Oil Sands, Conventional, and Offshore. Its Downstream segment consists of Canadian Manufacturing, and United States Manufacturing. The Company's upstream operations include oil sands projects in northern Alberta, thermal and conventional crude oil, natural gas and natural gas liquids (NGLs) projects across Western Canada, crude oil production offshore Newfoundland and Labrador and natural gas and NGLs production offshore China and Indonesia. The Company's downstream operations include upgrading and refining operations in Canada and the United States, and commercial fuel operations across Canada.


TSX:CVE - Post by User

Bullboard Posts
Comment by Fundipon Feb 15, 2018 10:01pm
288 Views
Post# 27569361

RE:RE:Can anyone explain?

RE:RE:Can anyone explain?I think I got it now.

CVE is trading low because WCS is at $33. It doesn't trade with WTI. Aeco nat gas is well under $2. CVE has $9 billion in debt and analysts are frustrated that CVE isn't selling off its refinery and all their non-oil sands assets. CVE doesn't want to sell them because they believe they are more valuable long term. Whatever assets they do have on sale will probably not get a good price because natural gas prices are so low.


HOWEVER, I believe CVE is one heck of an opportunity. If you take a look at the historical WCS-WTI differential, -$25 to -$30 rarely holds for more than a few months, and the CVE CEO said as much today. He said that it will narrow in the short term because the pipeline that is running at 80% will "soon" go back to max flow. Also, they will start shipping oil by rail this summer, which will narrow the differential. 

For every extra $1 in WCS, they make like $120 million extra a year. They don't need to sell any assets, I think they can whittle down debt with their FFO. Analysts always have a very short term, myopic view. CVE should do what they're doing and they will do very well in a few years. 
Read more at https://www.stockhouse.com/companies/bullboard?symbol=t.cpg&postid=27569348#7b5V5oS0AlUXECy7.99
Bullboard Posts