Back to top

Image: Bigstock

Is a Beat in the Offing for Cenovus (CVE) in Q2 Earnings?

Read MoreHide Full Article

Cenovus Energy Inc. (CVE - Free Report) is set to report second-quarter 2022 results on Jul 28, before the opening bell.

In the last reported quarter, the leading integrated energy company recorded earnings per share of 62 cents, missing the Zacks Consensus Estimate of earnings of 64 cents due to increased transportation and blending expenses, as well as expenses for purchased products. The positives were partially offset by higher daily oil sand production.

Cenovus’ bottom line missed the Zacks Consensus Estimate in three of the prior four quarters and beat the same once, the average negative surprise being 27.2%. This is depicted in the graph below:

Cenovus Energy Inc Price and EPS Surprise

 

Cenovus Energy Inc Price and EPS Surprise

Cenovus Energy Inc price-eps-surprise | Cenovus Energy Inc Quote

Let’s see how things have shaped up prior to this announcement.

Estimate Trend

The Zacks Consensus Estimate for second-quarter earnings per share of 80 cents has witnessed one upward revision and no downward movement in the past 30 days. The estimated figure suggests a 789% increase from the prior year’s reported number.

Earnings Whispers

Our proven model conclusively predicts an earnings beat for Cenovus this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

Earnings ESP: The company has an Earnings ESP of +6.25%. This is because the Most Accurate Estimate is currently pegged at 85 cents per share, whereas the Zacks Consensus Estimate is pinned at 80 cents per share. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Cenovus currently sports a Zacks Rank #1.

Factors to Consider

In the June-end quarter of 2022, oil prices were significantly higher than the year-ago comparable quarter. The sharp rise in oil price can be linked to the assumptions by many analysts that the Ukraine war may be prolonged. Being involved in exploration activities in Canada, the company’s upstream operations are likely to have been aided by the favorable commodity price scenario in the to-be-reported quarter.

The demand for refined petroleum products rose drastically in the second quarter due to improved fuel consumption. Improving fuel demand has aided the company’s refining and processing businesses. Cenovus’ performance is likely to have been backed by the favorable downstream business since it has a vast network of upgraders and refineries.

Other Stocks to Consider

Here are some other companies from the Energy space that you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat in the upcoming quarterly reports:

Chevron Corporation (CVX - Free Report) has an Earnings ESP of +1.35% and is a Zacks #2 Ranked player at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Chevron is scheduled to release second-quarter results on Jul 29. The Zacks Consensus Estimate for CVX’s quarterly earnings is pegged at $4.95 per share, suggesting an increase of 189.5% from the prior-year reported figure.

Imperial Oil Limited (IMO - Free Report) has an Earnings ESP of +2.41% and is a Zacks #2 Ranked player at present.

Imperial Oil is scheduled to release second-quarter results on Jul 29. The Zacks Consensus Estimate for IMO’s quarterly earnings is pegged at $2.14 per share, suggesting an increase of 422% from the prior-year reported figure.

Phillips 66 (PSX - Free Report) has an Earnings ESP of +8.38% and is a Zacks #1 Ranked player at present.

Phillips 66 is scheduled to release its second-quarter results on Jul 29. The Zacks Consensus Estimate for PSX’s quarterly earnings is pegged at $5.49 per share, suggesting a massive improvement from the prior-year reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


Zacks' 7 Best Strong Buy Stocks (New Research Report)


Valued at $99, click below to receive our just-released report
predicting the 7 stocks that will soar highest in the coming month.


Click Here, It's Really Free

Published in