Analyst Reinstates Coverage of Cenovus Energy (CVE) with ‘Buy’ Rating

Cenovus Energy Inc. (NYSE:CVE) is included among the 10 Best Natural Gas Stocks to Buy Right Now.

Cenovus Energy Inc. (NYSE:CVE) is an integrated energy company with oil and natural gas production operations in Canada and the Asia Pacific region, and upgrading, refining, and marketing operations in Canada and the United States.

Cenovus Energy Inc. (NYSE:CVE) received a boost on January 2 when Goldman Sachs analyst Neil Mehta reinstated coverage of the stock with a ‘Buy’ rating and a price target of $20, indicating an upside of 20% from the current share price. The analyst expects Cenovus to generate ‘strong’ free cash flow over the long term, especially after the acquisition of MEG Energy in November. The multi-billion dollar deal has added 110,000 bpd of long-life, low-cost assets to the company’s portfolio, consolidating a core growth area in northern Alberta. The MEG acquisition is expected to be immediately accretive to funds flow. Cenovus expects to produce between 945,000 and 985,000 boed in 2026, representing approximately 4% YoY growth.

Moreover, the analyst highlighted Cenovus’ sale of 50% interest in the Wood River and Borger refineries to Phillips 66 in September, adding that it has improved the company’s fundamentals. The Canadian energy operator had been experiencing underperformance at some of its US refineries, and the aforementioned transaction has now simplified its downstream business and sharpened its focus on assets tied to heavy oil operations.

With an annual dividend yield of 3.49%, Cenovus Energy Inc. (NYSE:CVE) is included among the 15 Global Dividend Stocks to Diversify Your Portfolio.

READ NEXT: 12 Best Crude Oil Stocks to Buy for Dividends and 11 Best Performing Energy Stocks in 2025.

Disclosure: None.