We know that Canada is rich in natural resources, and it is one of the primary industries that is driving the country’s economy. Also well known is that Canada is one of the world’s largest independent producers of oil and natural gas. During difficult times such as the pandemic or ongoing recession, energy stocks have proved to be extremely beneficial in mitigating risks in portfolios.
Now, it should also be noted that most top TSX stocks are energy stocks. In fact, 21.6% of the TSX 60 Index is dominated by energy stocks. So, you have quite a lot of options to choose from if you wish to explore investments in the energy sector.
In today’s article, we are going to discuss one of the top energy stocks, Cenovus Energy (TSX:CVE).
Let’s dive into why Cenovus has the potential to energize your portfolio even if most of the market is facing upheaval of recession and other affecting factors.
Cenovus makes $5 million investment in “Energy Hub”
The city of Lloydminster is about to get a big upgrade in the form of an “Energy Hub” event facility. This upgrade will boost the sports and cultural scene in this region, and the credit goes to Alberta’s largest oil and gas firm – Cenovus.
Cenovus has made a generous donation of $5 million towards the Cenovus Energy Hub. This sum will support community programming as well as cover the cost of construction for the upcoming 15 years.
The statement made by Cenovus regarding the investment reveals that the company aims to show their support for Lloydminster and its residents, as many of them are employees of Cenovus.
Further, the company has stated that this Energy Hub will be a “state-of-the-art” facility. It will host multiple types of events, such as sports tournaments, concerts, festivals, and more. Also, it will boost the economy of the region by attracting visitors from all around the country.
Another milestone achieved as Cenovus releases ESG report
Cenovus recently released its 2022 environmental, social, and governance (ESG) report on June 29. The report offers a thorough insight into its ESG targets, and the performance and progress of its sustainable development goals.
The firm has also announced another major achievement – it has reduced absolute methane emissions in its upstream operations. It has managed to achieve 80% of this goal that is set to be accomplished by 2028 year-end from a 2019 baseline.
As per a statement by Jon McKenzie, President and Chief Executive Officer of Cenovus, the reason behind this achievement is their application of advanced technology, which enables future decarbonization of their operations.
Bottom line
Cenovus has an average dividend yield of 2.4% and a payout ratio of 19%. Also, its earnings grew by 177.1% in the previous year. Experts predict that the price of the stock will rise by 31.8%.
Thus, given the company’s investment plans and growth potential, it is safe to say that Cenovus is the energy stock to buy to energize one’s portfolio right now!
