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Cenovus Energy (CVE) Q4 Earnings & Revenues Beat Estimates

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Cenovus Energy Inc. (CVE - Free Report) reported fourth-quarter 2021 earnings per share of 43 cents, beating the Zacks Consensus Estimate of earnings of 41 cents. The bottom line turned around from the year-ago loss of 35 cents per share.

Total quarterly revenues of $10,889 million surpassed the Zacks Consensus Estimate of $9,369 million. The top line also increased significantly from the year-ago quarter’s $2,739 million.

The strong quarterly results were driven by higher daily oil sand production, and increased contributions from Christina Lake and Foster Creek operations.

Operational Performance

Upstream

The quarterly operating margin from the Oil Sands unit was reported at C$1,890 million, improving from the year-ago C$612 million. Higher daily oil sand production primarily aided the segment.

In the December-end quarter, the company recorded daily oil sand production of 624.9 thousand barrels, up 64.1% year over year on contributions from its Christina Lake and Foster Creek operations.

The operating margin at the Conventional unit was C$260 million, up from C$82 million in the year-ago quarter. In the December-end quarter, the company recorded daily liquid production of 29.7 thousand barrels, up 20.7% year over year.

The Offshore segment generated an operating margin of C$408 million. In the December-end quarter, the company recorded daily offshore liquid production of 23.7 thousand barrels.

Downstream

From the Canadian Manufacturing unit, the company reported an operating margin of C$131 million, up from C$16 million in the year-ago quarter. The company recorded Crude Oil processed volumes at 108.3 thousand barrels per day (MBbl/D).

The operating loss from the U.S. Manufacturing unit was reported at C$97 million, wider than a loss of C$85 million in the prior-year quarter. Crude oil processed volumes were recorded at 361.6 MBbl/D, signifying an improvement from 169 MBbl/D in the year-ago quarter.

For the Retail unit, the company reported an operating margin of C$8 million.

Expenses

Transportation and blending expenses in the reported quarter increased to C$2,379 million from C$1,137 million a year ago. Expenses for purchased products rose to C$7,197 million from C$1,268 million in the prior-year quarter.

Capital Investment & Balance Sheet

The company made a total capital investment of C$835 million in the quarter under review.

As of Dec 31, 2021, the Canadian energy player had cash and cash equivalents of C$2,873 million. Total long-term debt was C$12,385 million. Its total debt to capitalization was 34.6%.

Reserves

Cenovus Energy reported 2021 year-end proved reserves of 6.1 billion Boe, suggesting a year-over-year increase of 21%. Based on working interest production, the estimated proved reserves life index was 21 years.

Zacks Rank & Stocks to Consider

The company currently carries a Zacks Rank #3 (Hold).

Investors interested in the energy sector might look at the following stocks that presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Marathon Petroleum Corporation (MPC - Free Report) is a leading independent refiner, transporter and marketer of petroleum products. MPC reported fourth-quarter 2021 adjusted earnings of $1.30 per share, which comfortably beat the Zacks Consensus Estimate of 47 cents.

Marathon Petroleum is expected to see an earnings growth of 129.8% in 2022. As of Dec 31, MPC had cash and cash equivalents of $5.3 billion. Marathon Petroleum repurchased shares worth $3 billion in the October-January period and has now completed around 55% of its target to buy back $10 billion in common stock. Further planning to reward its shareholders, MPC announced a $5-billion buyback program.

Valero Energy Corporation (VLO - Free Report) is the largest independent refiner and marketer of petroleum products in the United States. VLO reported fourth-quarter 2021 adjusted earnings of $2.47 per share, improving from a loss of $1.06 in the year-ago quarter.

Valero is expected to see an earnings growth of 150.2% in 2022. Among all the independent refiners, VLO offers the most diversified refinery base, with a capacity of 3.1 million barrels per day in its 15 refineries located throughout the United States, Canada and the Caribbean. The company’s Refining segment was responsible for 81.7% of the total margin in 2021. 

ConocoPhillips (COP - Free Report) , based in Houston, TX, is primarily involved in the exploration and production of oil and natural gas. COP recently reported fourth-quarter 2021 adjusted earnings per share of $2.27, comfortably beating the Zacks Consensus Estimate of $2.20.

ConocoPhillips’ earnings for 2022 are expected to soar 62.1% year over year. COP reported preliminary 2021 year-end proved reserves at 6.1 billion Boe. As of Dec 31, 2021, ConocoPhillips had $5,028 million in total cash and cash equivalents.

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