Cenovus will survive the oil slump

Article Excerpt

CENOVUS ENERGY INC. $20 (Toronto symbol CVE; Conservative Growth Portfolio, Resources sector; Shares outstanding: 833.2 million; Market cap: $16.7 billion; Price-to-sales ratio: 1.5; Dividend yield: 1.0%; TSI Network Rating: Average; www.cenovus.com) gets 35% of its revenue from its Western Canadian oil sands properties and conventional oil and gas wells. Its biggest properties are its 50%-owned Christina Lake and Foster Creek oil sands projects; Conoco Philips (New York symbol COP) owns the remaining 50%. Refineries temper Cenovus’s risk Refining supplies the remaining 65% of Cenovus’s revenue. The company ships its crude to its 50%-owned refineries in Illinois and Texas. Phillips 66 (New York symbol PSX) owns the other 50%. Cenovus’s revenue rose 25.1%, from $15.7 billion in 2011 to $19.6 billion in 2014. That’s mainly due to rising production at its oil sands operations. However, lower oil prices cut its 2015 revenue by 33.5%, to $13.1 billion. Earnings fell from $1.64 a share (or a total of$1.2 billion) in 2011 to $1.14 a share (or $868…