Cenovus Energy Inc.

On my other blog I am today writing about the presentation at the World Money Show in Toronto by Money Saver Magazine with Alan MacDonald.

I do not own this stock of Cenovus Energy Inc. (TSX-CVE, NYSE-CVE). This is another stock that was talked about at the 2010 Money Show in Toronto. There were those who liked oil companies and they mentioned both Suncor Energy Inc. (TSX-SU) and Cenovus Energy Inc. (TSX-CVE).

This company was split off from EnCana (TSX-ECA) in 2009. This was the oil part of EnCana and EnCana now is just a gas play. My spreadsheet reflects this split. I was also following Alberta Energy Co. (TSX-AEC) into EnCana. Also, between 2002 and 2008, the company was reporting in US$.

First I will talk about dividends. Dividend yields were a lot lower before company was split from EnCana. Perhaps I should say the dividends attached to this stock were lower prior to the split. The dividend yields of EnCana had a median value of 1.3%. The dividend yield median for Cenovus is at 2.9%.

This company was split from EnCana in 2009. Since then dividends are up by 4.9% per year. The dividends were flat for two years of 2009 and 2010. The years of 2011, 2013 and 2014 have seen 10% rises in dividends.

The 5 year median Dividend Payout Ratio for the EPS is at 67.2% and for CFPS is at 21%. The DPRs for EPS for 2013 was at 111.3% and for CFPS was at 21%. The DPRs for 2014 are expected to be better at $56% for EPS and 23% for CFPS.

Shareholders have a positive total return, but it is rather low. The 5 and 10 year total return is at 6.02% and 8.72% per year. The capital gain portion of this return is 2.58% and 5.60% per year. The dividend portion of this return is 3.45% and 3.12% per year. Note that it is now 5 years since this company was split off from EnCana.

Over the past 5 years, the Return on Equity was below 10% 3 times. The ROE for 2013 was 6.7% and the 5 year median ROE was 9.9%. The ROE on comprehensive income for 2013 was 8.1% and its 5 year median is 9.8%.

The debt ratios are fine, but the Liquidity Ratio is a bit low and the Leverage and Debt/Equity Ratios are a bit high. The Liquidity Ratio for 2013 was 1.48. The 5 year median is 1.24. I think it is better when this ratio is 1.50 or above. If you add in cash flow after dividends the ratio is 2.23. The Debt Ratio is good at 1.65 and its 5 year median is 1.74. The Leverage and Debt/Equity Ratios are 2.54 and 1.54. I think it is better when these ratios are 1.99 and 0.99 respectively and below.

Sound bit for Twitter and StockTwits is: Energy Dividend Growth Stock. See my spreadsheet at cve.htm. Note that there is a lot hidden in my spreadsheet, like US$ values and pre-2009 original values. Prior to 2009, reporting was in US$ and company was part of EnCana. Otherwise the spreadsheet would look too confusing. However, I am willing to share my whole spreadsheet with anyone interested.

This is the first of two parts. The second part will be posted on Thursday, November 13, 2014 and will be available here. The first part talks about the stock and the second part talks about the stock price.

Cenovus Energy Inc. is an integrated oil company. The Company's operations include enhanced oil recovery (EOR) properties and established crude oil and natural gas production in Alberta and Saskatchewan. It also has ownership interests in two refineries in Illinois and Texas, United States. Its web site is here Cenovus.

This blog is meant for educational purposes only, and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

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