CIBC Equity Reaserch on Sale of Husky AssetsOutperformer CVE-TSX, Sector: Energy Current Price (11/30/21): C$15.16 Price Target (12-18 mos.): C$22.00
A Nice Surprise Ahead Of Investor Day: Asset Sales Help Accelerate Debt Repayment And Shareholder Returns Cenovus has reached agreements to sell its retail gas station network and ~3,200 Boe/d (38% oil and natural gas liquids) in the Wembley region in two separate transactions for a total consideration of ~$660 million. We view this as a modest positive and on strategy given that proceeds will be used to lower outstanding leverage helping to accelerate cash returns to shareholders. Cenovus is hosting an Investor Day on December 8, where we expect further details around capital allocation, a deep dive on each asset and incremental potential synergies from the merger with Husky.