Analysts at RBC Capital Markets added two Canadian companies to the firm’s “Global Energy Best Ideas” list for February.
“In January, the RBC Global Energy Best Ideas List was flat compared to the iShares S&P Global Energy Sector ETF (IXC) which was down 0.8 per cent and a hybrid benchmark (75-per-cent IXC, 25-per-cent JXI – iShares Global Utilities ETF) that was down 1.6 per cent on a sequential basis,” the firm said. “Since its inception in February 2013, the RBC Global Energy Best Ideas List is up 157.4 per cent compared to the S&P Global Energy Sector ETF up 29.2 per cent.”
The newcomers to the list, which now contains 25 equities, are:
* Cenovus Energy Inc. with an “outperform” rating and $28 target. The average on the Street is $29.63.
“We are adding CVE to the Energy Best Ideas list given the degree to which the stock has underperformed on a relative basis and based upon our candid conversations with Cenovus’ President & CEO Jon McKenzie, which reinforced our confidence that the company’s operating and financial momentum will improve as 2024 unfolds, opening the door to relative share price appreciation,” said analyst Greg Pardy.
* Enerflex Ltd. with an “outperform” rating and $12 target. Average: $10.53.
“We believe that EFX is positioned for valuation accretion given the stock underperformance in 2023 relative to its peers, with the potential for FCF inflection in FY24 on strong fundamentals and merger integration progress,” said analyst Keith Mackey.
Returning Canadian companies are:
- AltaGas Ltd. with an “outperform” rating and $32 target. The average on the Street is $32.83.
- Arc Resources Ltd. with an “outperform” rating and $26 target. Average: $26.64.
- Canadian Natural Resources Ltd. with an “outperform” rating and $94 target. Average: $95.61.
- MEG Energy Corp. with an “outperform” rating and $31 target. Average: $30.12.
- Northland Power Inc. with an “outperform” rating and $28 target. Average: $32.
- Obsidian Energy Ltd. with an “outperform” rating and $14 target. Average: $13.06.
- Pason Systems Inc. with an “outperform” rating and $19 target. Average: $18.29.
- Pembina Pipeline Corp. with an “outperform” rating and $58 target. Average: $52.29.
- Suncor Energy Inc. with an “outperform” rating and $51 target. Average: $51.
- Superior Plus Corp. with an “outperform” rating and $15 target. Average: $13.34.
- Topaz Energy Corp. with an “outperform” rating and $25 target. Average: $27.04.
- Tourmaline Oil Corp. with an “outperform” rating and $80 target. Average: $79.53.