Stock of the Day

March 30, 2021

Cenovus Energy (CVE)

$13.46
+$0.25 (+1.9%)
Market Cap: $24.60B

About Cenovus Energy

Cenovus Energy Inc., together with its subsidiaries, develops, produces, refines, transports, and markets crude oil, natural gas, and refined petroleum products in Canada and internationally. The company operates through Oil Sands, Conventional, Offshore, Canadian Refining, and U.S. Refining segments. The Oil Sands segment develops and produces bitumen and heavy oil in northern Alberta and Saskatchewan. This segment assets include Foster Creek, Christina Lake, and Sunrise projects, as well as Lloydminster thermal and conventional heavy oil assets. The Conventional segment holds natural gas liquids and natural gas assets primarily located in Elmworth-Wapiti, Kaybob-Edson, Clearwater, and Rainbow Lake operating in Alberta and British Columbia, as well as interests in various natural gas processing facilities. The offshore segment engages in offshore operation, exploration, and development activities in China and the East Coast of Canada. The Canadian Refining segment owns and operates Lloydminster upgrading and asphalt refining complex, which converts heavy oil and bitumen into synthetic crude oil, diesel, asphalt, and other ancillary products, as well as Bruderheim crude-by-rail terminal and ethanol plants. The U.S. Refining segment refines crude oil to produce gasoline, diesel, jet fuel, asphalt, and other products. Cenovus Energy Inc. is headquartered in Calgary, Canada.

Cenovus Energy Bull Case

Here are some ways that investors could benefit from investing in Cenovus Energy Inc.:

  • The current stock price is around $13.75, which may present a buying opportunity for investors looking for value in the energy sector.
  • Recent institutional investments, such as Ameriprise Financial Inc. increasing its holdings by 37.9%, indicate growing confidence in the company's future performance.
  • Analysts have a consensus rating of "Moderate Buy" for Cenovus Energy Inc., suggesting that many believe the stock has potential for growth.
  • Several analysts have set a price target of $25.75, which implies significant upside potential from the current trading price.
  • The company has seen a diverse range of institutional investors increasing their stakes, which can be a positive signal of stability and confidence in the company's operations.

Cenovus Energy Bear Case

Investors should be bearish about investing in Cenovus Energy Inc. for these reasons:

  • Wellington Management Group LLP recently reduced its stake by 46.2%, which may indicate a lack of confidence in the company's short-term prospects.
  • Some analysts have downgraded their ratings, with Veritas lowering Cenovus Energy from a "strong-buy" to a "hold," suggesting caution among market experts.
  • The stock has experienced volatility, with a 1-year low of $10.23, indicating potential risks associated with price fluctuations.
  • Institutional investors currently own over 51% of the stock, which can lead to increased volatility if large investors decide to sell.
  • Market conditions in the oil and gas sector can be unpredictable, which may affect the company's performance and stock price in the future.
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