5 Most Undervalued Foreign Stocks To Buy According To Hedge Funds

3. Cenovus Energy Inc. (NYSE:CVE)

Number of Hedge Fund Holders: 47

P/E Ratio as of January 23: 9.80

Cenovus Energy Inc. (NYSE:CVE) is headquartered in Calgary, Canada, and the company develops, produces, and markets crude oil, natural gas liquids, and natural gas in Canada, the United States, and the Asia Pacific region. Cenovus Energy Inc. (NYSE:CVE) operates through Oil Sands, Conventional, Offshore, Canadian Manufacturing, U.S. Manufacturing, and Retail segments. It is one of the most undervalued foreign stocks to monitor. On January 17, Scotiabank analyst Jason Bouvier reiterated an Outperform rating on Cenovus Energy Inc. (NYSE:CVE) but trimmed the firm’s price target on the shares to C$31 from C$33. 

According to Insider Monkey’s third quarter database, Cenovus Energy Inc. (NYSE:CVE) was part of 47 hedge fund portfolios, compared to 42 in the prior quarter. Eric W. Mandelblatt’s Soroban Capital Partners is the largest stakeholder of the company, with nearly 52 million shares worth $798.5 million. 

Here is what L1 Capital Long Short Fund has to say about Cenovus Energy Inc. (NYSE:CVE) in its Q3 2022 investor letter:

“Cenovus Energy (Long -13%) shares declined over the quarter due to an ~18% decline in oil prices on increasing fears of a U.S recession and a slowdown in global growth. Given the long-life nature of its oil sand assets and its low cost of production, we estimate Cenovus is free cash flow break-even at an oil price of ~US$40/bbl. Despite the recent fall, oil prices remain more than double this break-even point, implying considerable free cash flow generation potential for the company at current levels, with Cenovus currently trading on a consensus FY22 free cash flow yield of around 20%. There are also additional value realization catalysts with the company continuing to progress the de-gearing of its balance sheet via organic cash generation and asset sales.”