Cenovus Energy (CVE.TO)

Makes sense to him. Deep Basin assets were picked up years ago, so this would be a chance to monetize those, pay down debt, and accelerate ROC to shareholders. Bay Street would probably view this very favourably. Shareholders want capital returned via share buybacks, and it's at a bit of a competitive disadvantage to companies like SU that return more capital to shareholders.

Believes reported headline number of $3B is light. Could be closer to $4B in asset sales.

Added in the high teens. Still undervalued, even at current share price. Fixed downstream challenges. One of the best operators in oil sands properties. Trades at 6.4x cashflow for 2026. He thinks 8x is appropriate, which is 32% upside at $60 oil, 60% upside at $70.

He owns other names, but you can't go wrong with this one. Good quality management. If he owned it, he'd hold. If you didn't own it, one of the go-to names for a Canadian portfolio.

On his farm team list of names he'd like to own. If RSI in energy were to turn higher, certainly a potential target for his portfolios. Trading above a rising 50-day MA, which seems to be in decent support here. Long term, probably a great buy. Acquisition of MEG was excellent.

In short run, he's not adding any energy until he sees some technical improvement.

Sensible deal with MEG. If you're buying a stock with a 3-month view, then you want to focus on your entry and exit points. Otherwise, he hesitates to talk about them.

Oil price environment is constructive. Reasonably good operator. Bit more integrated than, say, CNQ. Cashflow, dividends, growth. Buying now gives you a good setup for a 5- or 10-year view.

Energy has been doing well on a relative strength basis. There's a change in leadership, given weakness in tech, AI and industrials. Defensives--financials, healthcare and energy--are doing well, however. Energy is doing well despite the oil price going nowhere. The CVE chart is nice with higher highs and higher lows, but testing restistance now at $25.50.

From a momentum and charting perspective, looks better than peers. The one name in the space that's done well.

Cleaned up refining operations. MEG assets are a great fit. Great levered play on oil, but there are better such plays.

Done deal now, so MEG shareholders essentially own CVE. So the question becomes do you want to own CVE? He'd rather own a name with more natural gas exposure, as there's better growth there going forward. ARX comes to mind.

Likes it a lot. Needed to spend to upgrade refineries, so debt ramped up but has since been reduced to a reasonable level. Buying MEG, but shareholder meeting paused again today. We'll see how that goes, willing to stick it out.

Ultimately would be a good deal. Weighs on CVE in the short term, as it has to finance the merger and a portion of that would be in equity. 

Going to be lots of consolidation in the space, which has really good tailwinds. For the first time in many years, federal government is really intent on getting resources offshore. LNG Canada, despite delays, is up and operating.

Cheap relative to group. Higher debt profile, but company aims to get it in line by 2026. A strategic merger with MEG would be very good for stakeholders.

He likes Cenovus Energy and considers it the least awful of the oil sands companies. The merger with Meg Energy makes great sense from a Canadian perspective and an energy investment perspective.

Likes it. Hold, or buy more here. Making lots of $$. Trades ~13-14x PE. Huge share buyback program, which they can only do if making money and puts a floor under the stock.

You could look to sell a covered call on this to try to generate some premium. He'd probably wait until it's over $25 to do that.

You might see a 3 to 4% drop if the rumoured offer goes through. It has a great upstream business with its strong oil sands holdings. It owns some old refineries in the U.S. which have caused some issues. It is one of the cheapest in valuation in Canada for the sector.

Both oil and oil in Canada are just drifting. No real catalyst imminent. Trying to restructure and clean things up, and they've been very transparent on that. Great company, high-quality business. Still great margins, throwing off lots of $$. Inexpensive; can't sit around and wait for a breakout, because when the moves come they're pretty dramatic.

He owns CNQ instead.

It has a very long life reserve index. It is also integrated with refineries and has bought some in the U.S. which were not doing well. It is now starting to turn them around and is in a sweet spot. It has more cash flow and is increasing its share buyback. It is now in another sweet spot nearing a net debt level of $4 billion. It has just increased its dividend which stands at 4 1/2 to 5%. We should see a much higher oil price in the second half of the year.          Buy 18  Hold 1  Sell 1