Cenovus Energy Inc T.CVE

CC: BIAS Of Buybacks Over Special Dividends Right Now

[ztransforms173]

Long-term CAPITAL STRUCTURE:

* long-term debt of $ 7 BILLION

* balance sheet CASH of $ 3 BILLION

* NET DEBT of $ 4 BILLION

- in 2022, Cenovus Energy paid $ 4.5 BILLION in royalties and taxes which is GREATER than company-wide CAPEX or RETURNS to SHAREHOLDERS

- as expected, they will NOT BID for IRVING OIL and chances of them BUYING OUT PSX are VERY SLIM because of the HIGH ASSET PRICES DEMANDED by the 50% partner at the two US refineries

- they see STRONG demand for natural gas in Asia/Pacific

z173

[autofocus111]

$4B net debt was the target for end of 2022. Then that was reset to end of 2023 because they 'forgot' to factor in taxes. Now it's still a goal to hit $4B but when ??? 

[ztransforms173]

- LATE Q4/2023 or Q1/2024 depending on STRIP PRICING which is VERY VOLATILE - do not FORGET that they have the BIG PAYOUT for the WARRANTS in January 2024 z173

[autofocus111]

I didn't see that target date re-iterated anywhere in the PR/presentation. I know about the warrant repurchase. That is why I have doubts about the net debt target date.

[ztransforms173]

- one of the analysts asked the question in the CC and give HIS OPINION about the LIKELY $ 4 billion NET TARGET date - of course, it ALL depends on ACTUAL WTI, WCS, NG, C$/USD F/X  prices REALIZED etc. and the REFINERY 3-2-1 crack spreads on top of the OPERATIONAL PERFORMANCE of the assets, connecting pipelines and refineries and upgraders z173

[autofocus111]

I am talking about the target set by the company, not analysts. It appears the company has dropped their target date to hit the 4B.

[ztransforms173]

- the company NEVER gives you a FIRM TARGET DATE since they have NO CONTROL over it and they do NOT want to be SUED by shareholders - you seem to be a CRYBABY investor and you want somebody to hold your hand - CVE has EXPLICITLY STATED their RETURNS to SHAREHOLDERS FRAMEWORK so I do NOT see what your problem is - they are EXPECTING Q3 and Q4/2023 quarters to be OPERATIONALLY SUPERIOR to Q1/Q2

[autofocus111]

Of vourse they can't commit to a firm date duh. You again completely miseed my point. There has clearly been a shift in regards to the urgency in reducing the debt to the $4B threshold that triggers the shift to 100% return ot excess free cash flow to shareholders. And let's get things straight here... I am not complaining. I am very long CVE since they bought out HSE.

[meritmat]

Don't blame you. Originally it was suppose to be around 1qt of this year.  Then it's dumped down to end of the year.  Just got to wait it out 

[mnztr]

Some simple math tells me that barring any major price hike in oil that 4B net debt is about 2 years away. That said they do have some revenue catalysts coming on line inn the downstream sector and if crack spread remain high that could bring it forward significantly.