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MarketScreener Homepage  >  Equities  >  Toronto Stock Exchange  >  Cenovus Energy Inc.    CVE   CA15135U1093

CENOVUS ENERGY INC.

(CVE)
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Cenovus Energy CEO 'not worried' about Husky deal approval as results disappoint

10/29/2020 | 01:21pm EST
FILE PHOTO: Rows of steam generators line a road at the Cenovus Energy Christina Lake SAGD project south of Fort McMurray, Alberta, Canada

(Reuters) - The chief executive of Cenovus Energy said he is confident shareholders will approve its acquisition of rival Husky Energy, despite big quarterly losses and a stock sell-off.

Cenovus and Husky lost more money than analysts expected and took impairment hits in the third quarter, the companies said on Thursday, adding concerns to a C$3.6 billion ($2.73 billion) merger announced days earlier.

Cenovus stock fell 6.5% while Husky's fell 7%, both among the top percentage decliners on S&P/TSX Composite Index. Cenovus is down 12% since announcing the deal Sunday, including an 8% selloff on Monday.

The deal requires approval by shareholders of both companies.

"I'm not very worried," Cenovus Chief Executive Alex Pourbaix told Reuters. "What you saw on Monday was a lot of people with very short-term bias get out of the stock. I'm quite happy to replace those investors with investors with a longer-term view."

COVID-19-related lockdowns have floored fuel demand and added to the woes of Canada's energy sector, pushing companies to look at consolidation and layoffs.

Len Racioppo, managing director of Cenovus shareholder Coerente Capital Management, said acquiring Husky and its refineries "watered down" the bet he made on oil prices rising through owning Cenovus, which mainly has production assets.

Husky reported a C$7.08 billion net loss compared with a year-ago profit of C$273 million, hurt by a C$6.7 billion impairment related to lower long-term price assumptions and reduced capital spending.

Husky's loss of 38 Canadian cents per share excluding items was bigger than analysts' average estimate of 24 Canadian cents, according to Refinitiv IBES.

Excluding items, Cenovus's 37 Canadian cents per share loss was wider than the expected 6 Canadian cents. It booked a C$450-million impairment on a U.S. refinery.

Credit Suisse analysts said Husky's struggle to generate free cash flow will weigh on the combined company.

($1 = 1.3186 Canadian dollars)

(Reporting by Arunima Kumar and Shariq Khan in Bengaluru and Rod Nickel in Winnipeg; Editing by Ramakrishnan M., Alexandra Hudson)

By Arunima Kumar and Rod Nickel


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
CENOVUS ENERGY INC. 5.39% 7.23 Delayed Quote.-45.23%
CREDIT SUISSE GROUP AG 1.33% 11.815 Delayed Quote.-9.84%
HUSKY ENERGY INC. 5.37% 5.89 Delayed Quote.-43.47%
LONDON BRENT OIL 0.51% 49.04 Delayed Quote.-27.36%
S&P/TSX COMPOSITE INDEX 0.71% 17520.97 Delayed Quote.1.96%
WTI 0.97% 46.11 Delayed Quote.-26.86%
All news about CENOVUS ENERGY INC.
12/03CENOVUS ENERGY : Sale of Cenovus's Marten Hills oil assets to Headwater Explorat..
AQ
12/02Sale of Cenovus's Marten Hills oil assets to Headwater Exploration closes
GL
11/23CENOVUS ENERGY : and Husky announce leadership team for combined company
AQ
11/20TSX rises 0.7% to 17,028.73
RE
11/20CENOVUS ENERGY : and Husky announce leadership team for combined company
PU
11/20CENOVUS ENERGY : and Husky announce leadership team for combined company
AQ
11/20Cenovus and Husky announce leadership team for combined company
GL
11/20CENOVUS ENERGY : Oil And Gas Sector Consolidation Invites Competition Bureau Rev..
AQ
11/19HEADWATER EXPLORATION INC : . Announces Receipt of Shareholder Written Consent F..
AQ
11/17CENOVUS ENERGY : and Husky to hold special shareholder meetings on proposed Plan..
AQ
More news
Financials
Sales 2020 13 500 M 10 493 M 10 493 M
Net income 2020 -2 305 M -1 792 M -1 792 M
Net Debt 2020 7 565 M 5 880 M 5 880 M
P/E ratio 2020 -3,51x
Yield 2020 1,10%
Capitalization 8 430 M 6 546 M 6 553 M
EV / Sales 2020 1,18x
EV / Sales 2021 1,02x
Nbr of Employees 2 361
Free-Float 82,9%
Chart CENOVUS ENERGY INC.
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Cenovus Energy Inc. Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends CENOVUS ENERGY INC.
Short TermMid-TermLong Term
TrendsBullishNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 19
Average target price 7,39 CAD
Last Close Price 6,86 CAD
Spread / Highest target 60,3%
Spread / Average Target 7,71%
Spread / Lowest Target -41,7%
EPS Revisions
Managers
NameTitle
Alexander J. Pourbaix President, CEO & Non-Independent Director
Keith A. J. MacPhail Chairman
Jonathan M. McKenzie Chief Financial Officer & Executive Vice President
Harbir Singh Chhina Chief Technology Officer & Executive VP
Steven F. Leer Independent Director
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