The S&P/TSX Composite Index continues to hit new all-time highs this month. As of this writing, the Canadian benchmark index is up by 26.11% from its 52-week low ranges. Whereas the uptick within the index reveals the broader market is rallying, not each inventory is following the development. Some high-quality investments from the vitality trade are nonetheless lagging behind the remainder of the market.
Traders searching for the chance to put money into long-term winners at a cut price have the right alternative. As we speak, I’ll focus on one vitality inventory that’s too attractively priced to disregard in your self-directed funding portfolio.
Cenovus Vitality
Cenovus Vitality (TSX:CVE) is a Calgary-headquartered, $35.20 billion market-cap built-in vitality firm. It has operations producing crude oil and pure fuel all through Canada, the US, and the Asia-Pacific area. The corporate additionally creates loads of worth by its oil sands property.
As of this writing, CVE inventory trades for $19.31 per share, down by over 31% from its 52-week excessive ranges. It pays its traders $0.20 per share every quarter, translating to an annualized 4.14% dividend yield. The corporate’s shares have slipped considerably over the yr regardless of boasting strong fundamentals.
Is the enterprise robust?
Regardless of the worth chart above displaying what appears to be an abysmal efficiency on the inventory market, the enterprise goes robust. Cenovus’s upstream operations are strong, and it has loads of enlargement initiatives to enhance upstream operations additional. The primary quarter of 2025 noticed CVE report the manufacturing of 818,900 barrels of oil equal per day, getting near its all-time excessive manufacturing ranges. Its downstream section additionally noticed a 665,400 barrels per day throughput for crude oil.
Based on its quarterly report, its year-over-year adjusted internet revenue dropped to $859 million within the first quarter, however its revenue elevated fourfold. The $2.2 billion in adjusted funds move from the quarter left CVE inventory with nearly $1 billion in free funds move to return to shareholders as dividends or reinvest in capital applications.
Silly takeaway
Cenovus Vitality inventory looks as if an attractively priced funding at present ranges, and that’s as a result of it more than likely is. The corporate has a number of main initiatives nearing completion, like West White Rose and Narrows Lake. Based on estimates, the initiatives will begin producing inside the subsequent 12 months. These property can ship substantial returns, doubtlessly sparking a major turnaround in CVE inventory for its efficiency on the inventory market.
Since it’s affected closely by the costs of underlying commodities, Cenovus Vitality inventory is prone to volatility in vitality costs. Secure oil costs or increased costs can spell nice information for CVE inventory. Nevertheless, a major decline in oil costs can have a adverse short-term affect on its efficiency within the inventory market.
If you’re bullish on the vitality sector and wish to put money into a inventory that has loads of upside potential with good quarterly payouts, CVE inventory could be a superb funding to think about. Simply be sure to don’t make investments greater than you possibly can tolerate dropping if the market setting turns into risky.