It has been about a month since the last earnings report for Cenovus Energy (CVE). Shares have added about 4.7% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Cenovus due for a pullback? Well, first let's take a quick look at its most recent earnings report in order to get a better handle on the recent catalysts for Cenovus Energy Inc before we dive into how investors and analysts have reacted as of late.
Cenovus Energy Q1 Earnings Beat Estimates
Cenovus Energyreported first-quarter 2026 adjusted earnings of 61 cents per share, which beat the Zacks Consensus Estimate of 56 cents by 8.9%. The bottom line increased from the year-ago quarter’s figure of 32 cents.
Total quarterly revenues of $9 billion missed the Zacks Consensus Estimate of $9.3 billion by 3.2%. The top line declined from the year-ago quarter’s level of $9.3 billion.
Strong quarterly earnings were primarily driven by higher total upstream production. A rise in general and administrative expenses, and net foreign exchange (gain) loss, partially offset the positives.
Operational Performance
Upstream
Cenovus Sees Oil Sands Revenue Growth Despite Price Mix
Cenovus’ Oil Sands segment revenues increased to C$7.8 billion from C$7.0 billion in the year-ago quarter, driven by higher sales volumes. The operating margin from the Oil Sands unit totaled C$3.1 billion, up from C$2.54 billion reported a year ago.
Cenovus’ Conventional segment revenues increased to C$1.0 billion from C$924 million in the first quarter of 2025. The operating margin from the Conventional unit totaled C$211 million, reflecting a significant increase from C$173 million recorded in the year-ago quarter.
Cenovus’ Offshore segment revenues were C$524 million, higher than the C$426 million recorded in the prior year. The Offshore unit recorded an operating margin of C$402 million, up from C$331 million in the year-ago quarter.
CVE's Output Rises on Oil Sands
In the first quarter, the company recorded Oil Sands crude oil and natural gas liquids production of 772.6 thousand barrels per day (Mbbls/d), an increase from the year-ago quarter’s figure of 624.3 Mbbls/d. Oil Sands natural gas production was 14.4 million cubic feet per day (MMcf/d), higher than the 11.4 MMcf/d recorded a year ago. Oil Sands volumes rose 23.8% to 775.0 thousand barrels of oil equivalent per day (Mboe/d) from 626.2 Mboe/d in the year-ago quarter.
The company’s Conventional crude oil and natural gas liquids production was 28.9 Mbbls/d compared with 25.7 Mbbls/d a year ago. Conventional natural gas production was 852 MMcf/d, lower than the 887.9 MMcf/d recorded a year ago. Conventional volumes dipped 1.8% to 121.7 Mboe/d from 123.9 Mboe/d recorded in the first quarter of 2025.
The company’s Offshore crude oil and natural gas liquids production was 28.6 Mbbls/d compared with 20.9 Mbbls/d a year ago. Offshore natural gas production was 281.2 million cubic feet per day (MMcf/d), lower than the 287.2 MMcf/d recorded a year ago. Offshore production increased 9.6% to 75.4 Mboe/d from the year-ago figure of 68.8 Mboe/d.
The total upstream production in the reported quarter increased 18.7% to 972.1 (Mboe/d) compared with 818.9 Mboe/d in the year-earlier quarter.
Downstream
CVE’s Downstream Segment Profitability Improved Sharply
Cenovus’ Canadian Refining segment revenues were C$1.4 billion, higher than the C$1.3 billion recorded in the prior year. The operating margin from the Canadian Refining unit was C$201 million, which improved from C$68 million in the first quarter of 2024.
The U.S. Refining segment recorded revenues of C$4.2 billion, lower than the prior-year figure of C$6.4 billion. The operating margin from the U.S. Refining unit was C$533 million against a negative operating margin of C$305 million in the prior-year quarter.
Total downstream revenues decreased to C$5.6 billion from C$7.7 billion a year ago, while operating margin rose to C$734 million from a negative C$237 million a year ago.
CVE's Downstream Resets After WRB Divestiture
Downstream operations reflected the impact of the WRB divestiture completed in late 2025. Total crude oil unit throughput fell 31.1% year over year to 458.5 Mbbls/d, driven by a 38.0% decline in U.S. Refining throughput to 343.2 Mbbls/d. Canadian Refining throughput increased 3.0% to 115.3 Mbbls/d, driven by strong utilization.
Expenses of CVE
General and administrative expenses increased to C$411 million from C$197 million recorded in the first quarter of 2025. CVE also recorded C$179 million of net foreign exchange (gain) loss.
Expenses for Purchased Product, Transportation and Blending costs decreased to C$6.6 billion from C$8.9 billion in the prior-year quarter.
CVE: Cash Flow & Balance Sheet
Cenovus generated cash from operating activities of C$2.2 billion, up from C$1.3 billion a year ago. Cenovus made a total capital investment of C$1.2 billion in the quarter under review.
As of March 31, 2026, the Canada-based energy player had cash and cash equivalents of C$2.6 billion. Long-term debt declined to C$10.6 billion as of March 31, 2026, from C$11 billion at the end of 2025.
CVE Steps Up Shareholder Returns
Cenovus returned C$1 billion to common and preferred shareholders in the reported quarter. This included C$377 million in common-share base dividends and C$356 million of common-share repurchases under its NCIB and C$300 million in preferred share redemptions.
The board declared a second-quarter base dividend of 22 cents (Canadian) per common share, up 10% from the prior quarterly base dividend level.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 17.5% due to these changes.
VGM Scores
At this time, Cenovus has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock has a score of B on the value side, putting it in the top 40% for value investors.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Cenovus has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Cenovus belongs to the Zacks Oil and Gas - Integrated - Canadian industry. Another stock from the same industry, Imperial Oil (IMO), has gained 0.8% over the past month. More than a month has passed since the company reported results for the quarter ended March 2026.
Imperial Oil reported revenues of $9.07 billion in the last reported quarter, representing a year-over-year change of +4.1%. EPS of $1.41 for the same period compares with $1.75 a year ago.
Imperial Oil is expected to post earnings of $3.61 per share for the current quarter, representing a year-over-year change of +169.4%. Over the last 30 days, the Zacks Consensus Estimate has changed +7.9%.
Imperial Oil has a Zacks Rank #1 (Strong Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.
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This article originally published on Zacks Investment Research (zacks.com).