CVECN 3.8 09/15/2023 Corp & CVECN 6 ¾ 11/15/39 Corp

Cenovus Energy Inc

Credit, Energy


Publicly traded companies mentioned herein: Canadian Natural Resources Inc (CNQ), Cenovus Energy Inc (CVE), Equinor ASA (EQNR), Phillips 66 (PSX), Suncor Energy Inc (SU)

Highlights

The presenter is long the bonds of Canadian oil sands producer Cenovus Energy (CVE; CVECN 3.8 09/15/23 & 6 ¾ 11/15/39) due to a meaningful valuation disconnect (CVE vs. Suncor), the quality of CVE’s assets (i.e., it is the low-cost producer), and his opinion that either Suncor (SU) or CNQ could eventually acquire CVE. Given CVE’s production capabilities, operational flexibility, and liquidity, he likes the ‘23s in the low-70s and the ‘39s in the 62 - 65 range, further noting that he would use any weakness to add to his position (especially if the ‘39s fell back into the 50s). 

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Idea Discussion

Commentor 1 - 2 weeks ago

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