Cenovus Energy's Q2 Earnings on Deck: Should You Bet on the Stock?

Cenovus Energy Inc. CVE is set to report second-quarter 2026 results on July 29, before the opening bell.

The Zacks Consensus Estimate for second-quarter earnings is pegged at $1.11 per share, implying an improvement of 236.4% from the year-ago reported number. It has witnessed no estimate revisions in the past seven days. The Zacks Consensus Estimate for second-quarter revenues is currently pegged at $9.6 billion, suggesting an improvement of 7.4% from the year-ago actuals.

CVE beat the consensus estimate for earnings in each of the trailing four quarters, with the average surprise being 50.8%. This is depicted in the graph below:  

Image Source: Zacks Investment Research

Q2 Earnings Whispers for CVE

Our proven model doesn’t predict an earnings beat for CVE this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. That isn’t the case here.

The leading integrated energy player has an Earnings ESP of 0.00%. CVE currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

CVE’s Factors to Note

To have an idea of how oil prices behaved in the June quarter, let's analyze the commodity prices from the data provided by the U.S. Energy Information Administration (“EIA”). The average Cushing, OK, WTI spot prices for April, May and June of this year were $100.32 per barrel, $102.13 per barrel and $84.81 per barrel, respectively, per EIA data. Commodity prices were $63.54 per barrel, $62.17 per barrel and $68.17 per barrel, respectively, in April, May and June of 2025, according to the EIA.

A constructive oil-price backdrop due to the Iran war, aided the company’s exploration and production businesses in the June quarter of this year, in the same line as BP plc BP and Shell plc SHEL.

However, the high pricing environment is likely to have hurt the refining business of Cenovus Energy, since the input costs to produce final products like gasoline, diesel fuel and others were higher.

CVE’s Price Performance & Valuation

CVE's stock has surged 94.9% over the past year, outperforming the industry’s 73.2% growth. BP has gained 34.1% over the same time frame, while SHEL has jumped 22.4%.

One-Year Price Chart

Image Source: Zacks Investment Research

Although CVE’s stock price has outperformed the industry, the company appears relatively undervalued. The company's current trailing 12-month enterprise value/earnings before interest, tax, depreciation and amortization (EV/EBITDA) is 7.18x, reflecting that it is trading at a discount compared with the industry average of 7.63x. Both BP and SHEL are valued lower at 3.25x and 4.69x, respectively.

Image Source: Zacks Investment Research

Investment Thesis of CVE

West Texas Intermediate (“WTI”) crude is trading at more than the $80 per barrel mark. Ongoing tensions in the Middle East are driving the high price. The highly favorable pricing environment for the commodity is likely to support Cenovus Energy's exploration and production activities, given its strong portfolio of upstream assets with long-life oil reserves. This highlights the Canadian energy major’s strong production outlook.

The integrated player can lean on its low cost of operations, especially when the pricing environment turns unfavorable. The company stated in its corporate presentations that it needs to spend only $21 to produce and maintain each barrel of oil.

However, high oil prices are hurting the company’s downstream business, which includes refining activities. Also, the company’s overall business is extremely vulnerable to commodity prices, refining crack spreads and exchange rates.

Last Word

With Middle East conflicts continuing to affect oil energy businesses, it might not be wise for investors to bet on the stock right away, despite undervaluation.

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This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research