Bullboard - Stock Discussion Forum 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.... see more

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TSX:CVE - Post Discussion

Cenovus Energy Inc > RBC Foundation Report - CVE @ May 30, 2021

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Post by JohnSP on May 30, 2021 7:19pm

RBC Foundation Report - CVE @ May 30, 2021

Investment summary

We rate the common shares of Cenovus Energy Outperform.

• Merger with Husky. Cenovus Energy’s merger with Husky Energy via a share-exchange plan of arrangement is strategically sound in our eyes. On paper, the transaction fuses Husky’s diverse upstream/mid-stream/ downstream operations with Cenovus’ bitumen-weighted upstream portfolio. Strategically, the deal addresses Cenovus’ Achilles heel, which has been cash flow volatility. Under one roof, Cenovus-Husky becomes a more balanced integrated oil company with increased cash flow diversification.

• 2021 Budget. The company’s 2021 budget pointed towards mid-point production of 755,000 boe/d in the context of $2.3-$2.7 billion of capital spending. Embedded within this capital program is $520-$570 million pertaining to the Superior refinery rebuild, which is largely expected to be covered via insurance proceeds.

• Top Tier In-Situ Matters. Cenovus’ Christina Lake in-situ SAGD operations have the lowest steam-oil ratio (SOR) industry wide, with Foster Creek not far behind.

RBC Dominion Securities Inc. . Greg Pardy, CFA
(Head of Global Energy Research) (416) 842-7848 greg.pardy@rbccm.com

Outperform

TSX: CVE; CAD 9.83; NYSE: CVE

Price Target CAD 12.00

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