Cenovus Energy Incorporation (NYSE:CVE) is among the must-buy non-tech stocks to invest in now. On March 27, S&P Global Ratings upgraded its outlook on Cenovus Energy Incorporation (NYSE:CVE) to stable from negative and affirmed its BBB credit rating.
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The rating agency cited the company’s improved financials and advancement on growth projects as factors for the outlook revision. The S&P Global Ratings sees Cenovus Energy’s fund from operations to debt ratio reaching 70% – 80% in the next two years.
As part of its debt management strategy, the company decided to reduce its share repurchase allocation to 50% of excess free cash flow until it has cut down its net debt to C$6 billion. It plans to lift the allocation to 75% until it achieves its long-term target of reducing the net debt to C$4 billion.
According to S&P Global Ratings projections, Cenovus Energy will reach C$6 billion of net debt in either late 2027 or early 2028.
On growth, Cenovus Energy is working on five key growth projects. These are Christina Lake North expansion, Sunrise optimization, Foster Creek optimization, Narrows Lake tie back, and West White Rose. First oil from the West White Rose project is expected in mid-2026.
Three of these projects have already been brought online and the company is working to complete the rest. As Cenovus Energy completes these projects, its growth-focused capital spending is expected to drop by C$300 million in 2026 compared to the 2025 level.
With these projects, Cenovus Energy aims to increase production by 150,000 barrels per day by the end of 2028. That represents a 15%-20% production boost over its 2024 level.
On March 19, Goldman Sachs identified Cenovus Energy as one of its top oil stocks amid the Middle East disruptions. According to the equity research firm, Cenovus Energy offers the highest total return potential among Canadian oil companies. The firm sees volume growth contributing to peer-leading free cash flow yields at Cenovus Energy in the 2027-2028 period.
Cenovus Energy Incorporation (NYSE:CVE) is a Canadian oil and natural gas company. It develops, produces, refines, distributes crude oil, natural gas, and refined petroleum products. The company serves the Canadian, US, and Chinese markets. It operates refineries in Canada and the US. Founded in 2009, Cenovus Energy is headquartered in Calgary, Canada.
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