Cenovus Energy Inc. CVE reported first-quarter 2025 adjusted earnings per share of 32 cents, which beat the Zacks Consensus Estimate of 29 cents. The bottom line, however, declined from the year-ago figure of 46 cents.
Total quarterly revenues of $9.3 billion missed the Zacks Consensus Estimate of $9.5 billion. The top line decreased from the year-ago quarter’s level of $9.9 billion. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
Better-than-expected quarterly earnings can be attributed to higher contributions from the Oil Sands, Conventional, and Offshore units. However, a significant decline in contributions from the U.S. Manufacturing unit and higher transportation and blending expenses partially offset the positives.
Cenovus Energy Inc Price, Consensus and EPS Surprise
Cenovus Energy Inc Price, Consensus and EPS Surprise
Cenovus Energy Inc price-consensus-eps-surprise-chart | Cenovus Energy Inc Quote
Dividend Hike
Cenovus has announced a quarterly base dividend of 20 cents per common share ($0.80 on an annualized basis) on June 30, 2025, to shareholders of record as of June 13, 2025. This represents an 11% increase in the annual base dividend.
Operational Performance
Upstream
The quarterly operating margin from the Oil Sands unit totaled C$2.54 billion, up from C$2.24 billion reported a year ago.
In the March-end quarter, the company recorded daily oil sand production of 624.3 thousand barrels, up 1.8% year over year. The increase can be attributed to higher contributions from Foster Creek, partially offset by lower contributions from the Lloydminster Thermal operations.
The operating margin at the Conventional unit totaled C$173 million, reflecting an increase of 16% from C$149 million recorded in the year-ago quarter. The company’s daily liquid production was 25.7 thousand barrels compared with 27.3 thousand barrels a year ago. The total Conventional natural gas production from the segment came in at 589.3 MMcf/d, higher than 560.5 MMcf/d recorded a year ago.
The Offshore segment generated an operating margin of C$331 million, up from C$246 million in the year-ago quarter. Cenovus recorded daily offshore liquid production of 20.9 thousand barrels, up from 17.6 thousand barrels recorded a year ago. The Offshore segment was aided by increased output at the partner-operated Terra Nova field.
The total upstream production in the reported quarter was 818.9 thousand barrels of oil equivalent per day (Mboe/d) compared with 800.9 Mboe/d in the year-earlier quarter.
Downstream
The operating margin from the Canadian Manufacturing unit was C$68 million, flat year over year. The segment recorded Crude Oil processed volumes of 111.9 thousand barrels per day (MBbl/D).
The operating margin from the U.S. Manufacturing unit was reported at a loss of C$305 million against a positive operating margin of C$492 million in the prior-year quarter. Crude oil processed volumes totaled 553.5 MBbl/D, up from 551.1 MBbl/D in the year-ago quarter. The segment was impacted by narrow heavy oil price differentials.
Expenses
Transportation and blending expenses increased to C$3.25 billion from C$2.81 billion recorded a year ago.
Also, expenses for purchased products increased to C$1.2 billion from C$771 million in the prior-year quarter.
Capital Investment & Balance Sheet
Cenovus made a total capital investment of C$1.23 billion in the quarter under review.
As of March 31, 2025, the Canada-based energy player had cash and cash equivalents of C$2.77 billion and a long-term debt of C$7.33 billion.
Guidance
Cenovus reiterated its full-year 2025 guidance for total upstream production in the band of 805-845 MBoe/d. The midpoint of the range suggests an increase from the 2024 figure of 797.2 MBoe/d. The company expects downstream throughput to be in the range of 650-685 MBbls/d, implying an increase from 646.9 MBbls/d reported in 2024.
The company anticipates capital expenditure to be in the band of $4.6-$5 billion for the entire year, with approximately $1.4-$1.8 billion dedicated to growth-related initiatives.
CVE’s Zacks Rank and Key Picks
CVE currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the energy sector are Diversified Energy Company plc DEC, Expand Energy Corporation EXE and RPC, Inc. RES, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Diversified Energy Company is an independent oil and natural gas producer in the United States. The company is primarily engaged in the production, transportation, and marketing of natural gas and natural gas liquids. The rising demand for natural gas as a cleaner-burning fuel and an uptick in the commodity’s prices are expected to positively impact the company’s bottom line.
Expand Energy is a leading U.S.-based natural gas producer formed through the merger of Chesapeake Energy Corporation and Southwestern Energy Company. Natural gas is expected to play an increasingly important role in the energy transition journey. Expand Energy is poised to benefit from the rising demand for natural gas as a cleaner-burning fuel. The recent rise in natural gas prices is also anticipated to positively impact EXE’s profitability.
RPC generates strong and stable revenues through a diverse range of oilfield services, including pressure pumping, coiled tubing and rental tools. RPC is strongly committed to returning value to shareholders through consistent dividends and share buybacks, making it an attractive choice for investors looking to earn steady returns.
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