Cenovus Energy (CVE.TO)

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

Showing good downstream turnarounds. Look beyond 2025, when tariffs will have been resolved. Energy should bypass a lot of that because of how strategic it is, so we're not going to see a 50% tariff. Buy this and sleep at night, because you don't have to worry about tariff implications a few months from now.

Likes energy right now. Stock's come off sharply, energy prices have not been friendly. Decent long-term prospects. Energy prices should rebound, doesn't see them plummeting. With a long time horizon, pullback is a buying opportunity.

They are righting the ship, as seen in their last quarterly call. They've always held super upstream assets with no mine-life depletion issues. Fair value is higher, but they lack a catalyst. We won't see improvement in their downstream until Q3. Likes the management team.

Lots of capex to fix issues with refining assets. Sold last September when sentiment soured on price of oil. Investor sentiment muted even when company reached deleveraging targets. Nothing materially wrong with it, whole industry has rolled over. Sharp management, committed to investors.

When he's ready to get back into energy, he'd buy this at a much smaller weight and buy some SU as well.

Unique in that they own US refineries. Negative energy story has brought stock down. 

High exposure to price of oil and to the differential of Canadian heavy oil (back to almost-new lows). Upstream is going exceedingly well. But downstream has poor utilization rates, mishaps, negative EBITDA; those are all the reasons it's massively lagged peers. Fix that, and good rerate potential; won't play out until latter half of 2025 or early 2026.

If you own, he'd hesitate to sell. He's watching, near the top of his list to deploy capital. You could wake up one morning to a big pop in the stock price.

Downstream operations have been extremely weak. Look at the dividend history. They've cut the dividend in the past, so not a stable dividend payer. Dividend looks high because stock price is low. Look elsewhere.

Coming into the time when you want to own energy, between mid-February and May/June. Chart shows it's at, or maybe below, support. He'd need to see a bounce to be bullish on it. Watch for another 2 weeks or so; if it breaks down, you have to get out.

A value trap. The ultimate catalyst (fixing their downstream) keeps getting deferred and deferred. Share buybacks in recent months is sluggish. A very cheap stock, but downstream keeps biting them. He's cheering for them, but look at CNQ instead.

Q4 missed on downstream margins. Upstream projects are on schedule and on budget. Expects FCF to inflect meaningfully as spending drops and production starts to kick in. Sector faces headwinds, but this is a name you can go to. Way cheaper than peers. Nice production growth, cashflow growth, shareholder returns of 8%. Would be adversely hit by tariffs. All in, he'd be a buyer.

She doesn't own any producers, and she owns PPL, so she likes that idea.

Trades under 12x PE and are buying back lots of shares. Likes it. Options: sell the April $25 call and get 20 cents, not a big premium, but leaving lots upside to get closer to the upper-$20s. But he is not selling calls on CVE, because he expects the share price to recover. But at $27-28, he will sell at $30s. For new money, he will sell $20-22 puts.