Cenovus Energy Inc T.CVE

When oil hits $80-$90, I wonder which companies SMART enough

[RagingBull3]

to LOCK IN Profits (lock in most of their oil production at $80+ and lock in expenses....to lock in Cash Flow and Profits)????  

I would be seriously thinking of locking in some Profits/Cash Flow even now.   I'm not sure how Hedges work, but if they can do what I said above, that is what I would be looking for in a company to do.  

Once Cash Flow and Profits   SECURED..... Then it's simple to plan for Debt repayment, Dividends, CapEx......etc.    

If oil price crash, cut back on production to what's Secured at High prices.   If oil price rockets higher, well we secured debt repayments so FREE to increase dividends, CapEX, Production..

All just my opinion/view/thinking.

[SHayden]

CVE is unlikely to lock in much if any hedges. Also more often than not hedges are a money losing operation for producers.

[RagingBull3]

IMHO, it's the fear of oil price crash and the Debt that's holding back share prices in this sector.  This sector can't take another oil price crash.   It's been 7+ years....DEBT coming DUE.... Time is running out for many.....that is time is running out for Shareholders.... Companies/management will just "restructure" and continue on while Shareholders

[SHayden]

CVE can manage in a low pricing environment for a lot longer than most other companies. Also you talk so much about wanting profits, yet you want then to also take an action that will make them less profitable. CVE has a good enough plan on how to protect the company in a low price environment. At this point your just flip flopping on non issues.

[RagingBull3]

There's protecting the Company (and CEOs paychecks) and then there's protecting SHAREHODERS.      They are 2 different things.      Do you buy insurance on your house???   Why?   All just my opinion/view/thinking

[SHayden]

Those are two different things and not comparable. CVE is a low cost oil sands producer, they have many different income streams and pretty good diversification. They really don't need hedges on raw production. It's just a waste of money. They just need to stomp down the debt, direct all cash flow towards that, then in two years they will have very low debt for a company of their size

[RagingBull3]

In a way, you're correct.   I believe that's the whole idea/reason for buying Husky.  All just my opinion/view/thinking

[RagingBull3]

I'm guessing from 2014 to 2020  CEOs in this sector did just fine in the low oil price envirornment. I bet their paychecks didn't suffer much,  Share prices on the other hand took a beating.    Is that your reference on how a company can manage in a low price environment?   Let shareholders take it on the Chin??? All just my opinion/view/thinking

[Stockstag1]

It's a buyers dream  Huge Buying opportunity  Cheers  The Stag:) 

[SHayden]

You might want to do some more research, the oil price crash in 2016 impacted the company, but the thing that drove it down the most was when they loaded up on debt to buy out COP.

[RagingBull3]

Shayden thinks I'm a moron who thinks putting in Hedges when oil hits $80-$90 when I posted the comment when at that time it looked like it might go there.....  Yet, CVE put in hedges in the ~$60+ range....  This is what you call a Hypocrite, moron.    He'll come out to bash me for saying to put in Hedges in the $80-$90 ranges, and say how bad it is to do so......