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Cenovus (CVE) Up 13.6% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Cenovus Energy (CVE - Free Report) . Shares have added about 13.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Cenovus due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Cenovus reported first-quarter 2022 earnings per share of 62 cents, missing the Zacks Consensus Estimate of earnings of 64 cents. However, the bottom line improved from the year-ago quarter’s earnings of 8 cents per share.
Total quarterly revenues of $16,198 million beat the Zacks Consensus Estimate of $10,691 million. The top line significantly increased from the year-ago quarter’s $9,293 million.
The lower-than-expected earnings can be attributed to increased transportation and blending expenses, as well as expenses for purchased products. The positives were partially offset by higher daily oil sand production.
Dividend Hike
Cenovus has increased the quarterly base dividend to 10.5 Canadian cents per share, suggesting a 200% increase from 3.5 Canadian cents per share. The dividend will be paid on Jun 30, 2022, to common shareholders of record as of Jun 15, 2022.
Operational Performance
Upstream
The quarterly operating margin from the Oil Sands unit was reported at C$2,199 million, improving from C$1,141 million reported a year ago. Higher daily oil sand production primarily aided the segment.
In the March-end quarter, the company recorded daily oil sand production of 595 thousand barrels, up 7.5% year over year on contributions from its Christina Lake and Foster Creek operations.
The operating margin at the Conventional unit was C$263 million, up from C$210 million in the year-ago quarter. In the first quarter, the company recorded daily liquid production of 32.7 thousand barrels, down 11.4% year over year.
The Offshore segment generated an operating margin of C$458 million, up from C$344 million in the year-ago quarter. In the reported quarter, the company recorded daily offshore liquid production of 26.8 thousand barrels.
Downstream
From the Canadian Manufacturing unit, the company reported an operating margin of C$114 million, up from C$82 million in the year-ago quarter. The company recorded Crude Oil processed volumes at 98.1 thousand barrels per day (MBbl/D).
The operating margin from the U.S. Manufacturing unit was reported at C$423 million, up from C$91 million in the prior-year quarter. Crude oil processed volumes were 403.7 MBbl/D, signifying an improvement from 362.9 MBbl/D in the year-ago quarter.
For the Retail unit, the company reported an operating margin of C$7 million, down from C$11 million in the prior-year quarter.
Expenses
Transportation and blending expenses in the reported quarter increased to C$2,919 million from C$1,785 million a year ago. Expenses for purchased products rose to C$7,538 million from C$4,237 million in the prior-year quarter.
Capital Investment & Balance Sheet
The company made a total capital investment of C$746 million in the quarter under review.
As of Mar 31, 2022, the Canadian energy player had cash and cash equivalents of C$3,399 million. Total long-term debt was C$11,744 million. Its total debt-to-capitalization was 32.4%.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Cenovus has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Cenovus has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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Cenovus (CVE) Up 13.6% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Cenovus Energy (CVE - Free Report) . Shares have added about 13.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Cenovus due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Cenovus Misses Q1 Earnings Estimates, Revenues Beat
Cenovus reported first-quarter 2022 earnings per share of 62 cents, missing the Zacks Consensus Estimate of earnings of 64 cents. However, the bottom line improved from the year-ago quarter’s earnings of 8 cents per share.
Total quarterly revenues of $16,198 million beat the Zacks Consensus Estimate of $10,691 million. The top line significantly increased from the year-ago quarter’s $9,293 million.
The lower-than-expected earnings can be attributed to increased transportation and blending expenses, as well as expenses for purchased products. The positives were partially offset by higher daily oil sand production.
Dividend Hike
Cenovus has increased the quarterly base dividend to 10.5 Canadian cents per share, suggesting a 200% increase from 3.5 Canadian cents per share. The dividend will be paid on Jun 30, 2022, to common shareholders of record as of Jun 15, 2022.
Operational Performance
Upstream
The quarterly operating margin from the Oil Sands unit was reported at C$2,199 million, improving from C$1,141 million reported a year ago. Higher daily oil sand production primarily aided the segment.
In the March-end quarter, the company recorded daily oil sand production of 595 thousand barrels, up 7.5% year over year on contributions from its Christina Lake and Foster Creek operations.
The operating margin at the Conventional unit was C$263 million, up from C$210 million in the year-ago quarter. In the first quarter, the company recorded daily liquid production of 32.7 thousand barrels, down 11.4% year over year.
The Offshore segment generated an operating margin of C$458 million, up from C$344 million in the year-ago quarter. In the reported quarter, the company recorded daily offshore liquid production of 26.8 thousand barrels.
Downstream
From the Canadian Manufacturing unit, the company reported an operating margin of C$114 million, up from C$82 million in the year-ago quarter. The company recorded Crude Oil processed volumes at 98.1 thousand barrels per day (MBbl/D).
The operating margin from the U.S. Manufacturing unit was reported at C$423 million, up from C$91 million in the prior-year quarter. Crude oil processed volumes were 403.7 MBbl/D, signifying an improvement from 362.9 MBbl/D in the year-ago quarter.
For the Retail unit, the company reported an operating margin of C$7 million, down from C$11 million in the prior-year quarter.
Expenses
Transportation and blending expenses in the reported quarter increased to C$2,919 million from C$1,785 million a year ago. Expenses for purchased products rose to C$7,538 million from C$4,237 million in the prior-year quarter.
Capital Investment & Balance Sheet
The company made a total capital investment of C$746 million in the quarter under review.
As of Mar 31, 2022, the Canadian energy player had cash and cash equivalents of C$3,399 million. Total long-term debt was C$11,744 million. Its total debt-to-capitalization was 32.4%.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
At this time, Cenovus has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Cenovus has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.