Cenovus Energy (CVE.TO) Buy, Sell or Hold

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Cenovus Energy (CVE.TO)

45.79

+0.96 (2.14%)

as of Sep 8, 2026, 8:00:01 pm Market Open.

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Investor Insights

Sep 8, 2026, 12:00 am

This summary was created by AI, based on 29 opinions in the last 12 months.

Cenovus Energy (CVE) is viewed favorably by a number of analysts, who emphasize its strong operational performance, particularly following the MEG Energy acquisition. The company is recognized for its cost-effective operations and impressive refining margins, with significant upside potential suggested, ranging between 50-60%. It has been actively paying down debt and is expected to direct a large portion of its free cash flow back to shareholders, predominantly through buybacks. Despite some caution regarding its current valuation and debt levels, many see it as a solid investment choice, especially with rising oil prices and robust asset quality. Overall, while some analysts prefer other companies like CNQ, the general sentiment leans towards CVE being an attractive option for energy sector investors.

Consensus

Buy

Valuation

Undervalued

Similar

CNQ

PAST TOP PICK

(A Top Pick May 15/20, Up 87%) Only large cap he owns. The most near term catalyst. Has had time to digest the Husky assets. They have lots of assets that are non core that they can sell. The leverage they have taken on is being paid off faster than planned. At $60 oil, would trade at 9% free cashflow yield. At $70 it doubles.

PAST TOP PICK

(A Top Pick Apr 03/20, Up 181%) Bought Husky and gained scale. Became more integrated. It did take away some leverage to rising oil price. Took on debt they are aggressively paying down. Only large cap he owns right now. Highest free cashflow leverage, at 9% free cashflow at $60. Doubles at $70 oil. Could buy back all their shares and pay off debt in 5 years.

BUY

This is one of two oil large-caps he owns. CVE reported an inline quarter today, including taking a charge on the Keystone XL. At $60 oil, CVE is targeted at 19% free cash flow yield. They diluted some upside when they bought Husky Energy, but there are likely some assets in Husky to delever CVE. Large caps like this have really lagged the rise in oil prices but will bounce back. Doesn't know why it's getting pressured today, but he isn't worried. The merger with Husky means CVE is committed to paying down that debt, which he expects to reach a market average for debt by end of 2021.

DON'T BUY

HSE-T + CVE-T: Stay after the merger? He does not own either one. He understands the merger makes sense. There are a lot of cost savings that can be found. He prefers CNQ-T, PXT-T and one of his Top Picks today. He prefers these to HSE-T. If the sector bounces back you could get an uplift.

BUY ON WEAKNESS

He was not overly enthused by the Husky take over. He has warmed up to the outlook of the stock in a better oil price environment. At $50 oil, they do not compete as well as CNQ or SU. He has started to dip his toe into CVE. At $50 oil, they would be trading at a 24% free cashflow yield, which is compelling for a large cap stock.

COMMENT

It's fine but they have a lot of refining exposure where there is overcapacity. It's not terribly overbought like CNQ. There may be better areas to be invested. You probably want Canadian small-cap with some natural gas.

COMMENT

The unique thing is their cost profile -- it is very low compared to peers. The trouble for CVE is getting their production out of Canada. That is why he favours pipelines over producers. There is too much commodity price risk, so he would not be a buyer. You might want to consider EOG instead as they do not have pipeline constraints to worry about.

BUY ON WEAKNESS

Their balance isn't bad nor is their debt. Oil production is up, but they are vulnerable to lower oil prices. A WTI/WCS price pullback--which he expects--will push this stock back below $4. So, don't buy now. Long-term, this is better, or add on pullbacks. If you bought in March, you could so some trading.

DON'T BUY

A very levered play to oil. It has over $6.7 billion in liquidity. Their 2021 net-debt to cash flow is 24 times -- an accident waiting to happen. You need higher commodity prices for a some time to make this a good buy. He is not convinced energy prices are ready to get there just yet. He would not be buying now.

BUY ON WEAKNESS

He does not cover the company. The stock has recovered well. It is highly leveraged to oil prices, which he thinks are a little high right now (although he sees $40 in Q4 for WTI). It will probably retrace its price a little, perhaps below $4. Long term debt is $7.6 billion against $17 billion in equity, so the balance sheet is in good shape.

TOP PICK

They have ample liquidity and have access to $5.5 billion in capital. They have cash burn of $1.5 billion. This gives them years of longevity. He thinks Suncor might eventually take a run at them. This is the only large cap company he owns. He thinks it has upside of 100% or more. If you like the outlook for heavy oil, it is a good way to play the recovery. Yield 0% (Analysts’ price target is $6.12)

DON'T BUY

We have very depressed oil prices. You want to move into a more defensive category. He Prefers another if you have to have oil exposure.

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Curated by Allan Tong since 2019.
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TOP PICK

For those who can stomach a true oil stock that is not one Suncor and CNQ, then consider Cenovus. First of all, why consider any oil stock at all, the most beaten down sector on the TSX in recent years? Two reasons: the oil war between the Saudis and Russians and the end of the COVID-10 lockdown. Even if one of these events ends in the next month, energy stocks will enjoy a renaissance. A barrel of WCS has been scraping historic lows at $3.90.? To capitalize, choose a survivor, and CVE has enough liquidity to endure, notes analyst Eric Nuttall. Cenovus is the only large-cap oil he owns. Josef Schachter adds that CVE has a decent balance sheet. It prudently cut back its budget by over 30%.

TOP PICK

The only large cap producer he owns. They have liquidity to make it through. He projects a cash burn of $1.1 billion on over $4 billion of liquidity at $30 oil. Yield 0% (Analysts’ price target is $7.02)

COMMENT

Has a decent balance sheet with good cash flow. The dividend is safe, but they have cut back their budget over 30%. They will stop oil shipments by rail because of high costs and low oil prices. They were the first to batten down the hatches, but after we endure the oil and virus crises, CVE will survive. If low prices continue, they could cut costs further.

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Cenovus Energy (CVE.TO)