Why These 3 TSX Stocks Rallied on Thursday

Parex Resources (TSX:PXT), First Quantum (TSX:FM), and Cenovus Energy (TSX:CVE)(NYSE:CVE) are among the top TSX gainers on Thursday. Let’s find out why they’re rising.

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On Thursday, the Canadian stock market reversed initial losses to turn positive for the day — after losing 1.7% on Wednesday. Yesterday’s losses were primarily driven by the rising number of coronavirus cases in many U.S. states.

Nonetheless, after opening on a slightly negative note, the S&P/TSX Composite Index was up by 0.5% this afternoon despite worse-than-expected U.S. unemployment data.

Amid the ongoing pandemic-related worries, the stock market still seems to be full of opportunities.

Let’s take a closer look at three of the top TSX movers from Thursday and find out why they rose sharply.

Parex Resources

On June 25, shares of Parex Resources (TSX:PXT) rose by 3.3% after the company revealed its plan to increase production and restart capital expenditure programs in a press release yesterday. In the statement, the Canadian oil exploration firm also shared its second-quarter outlook with investors.

Overall, it expects its second-quarter average production to be 41,200 barrels of oil equivalent per day and its capital expenditures to be in the range of US$10 to US$12 million.

By the fourth quarter, the company plans to expand its oil production to around 44,000-48,000 barrels of oil equivalent per day.

After the announcements, analysts at Cormark Securities raised their target price on Parex Resources from $22.75 to $24 earlier today. Such factors boosted investors’ confidence and drove its stock higher on Thursday.

First Quantum Minerals

First Quantum Minerals(TSX:FM) stock also rose by over 3% Thursday morning after the research firm BMO revised its target price upward on the stock to $12.25 from $10 earlier. Last week, Jefferies upped its target on the company from $16 to $18. Currently, 17 out of 22 Wall Street analysts are recommending a “buy” on First Quantum — while the remaining five analysts are giving it a “hold” rating.

First Quantum Minerals is a Vancouver-based metal producer. While its stock is trading with 3.2% year-to-date losses, it has risen by more than 6% in the last five days. In the first quarter, the company’s revenue increased by 37.9% to US$1.2 billion — its highest quarterly revenue growth rate in years.

Cenovus Energy

In my yesterday’s market update, I highlighted how energy stocks are continuing to rally despite worries related to the pandemic. Similarly, shares of Cenovus Energy (TSX: CVE)(NYSE: CVE) — the Canadian oil and natural gas company — were up by 3.3% this morning.

This optimism came after Citigroup and the National Bank of Canada raised their price target on Cenovus Energy. Citigroup now has a target price of $9, while the National Bank of Canada gives a target price of $11.

In the first quarter, Cenovus Energy reported an adjusted net loss of $0.97 per share and saw its revenue fell by over 20% year over year as the oil demand across the globe slumped due to the pandemic.

As the world economy gradually reopens, the rising oil demand could help energy companies — including Cenovus Energy — regain investors’ confidence.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Jitendra Parashar has no position in any of the stocks mentioned. Tom Gardner owns shares of Jefferies Financial Group Inc. The Motley Fool owns shares of and recommends Jefferies Financial Group Inc.

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