Tudor, Pickering, Holt on Tuesday maintained its buy rating on the shares of Ovintiv (OVV.TO, OVV) with a US$56.00 price target following the oil and gas producer's fourth-quarter results.
"On the heels of last week's positive Anadarko sale announcement ($3.0B, closing early Q2'26), Q4 results beat expectations on production and FCF, which along with the return of capital update should continue driving relative outperformance, in our view. On Q4 results, non-GAAP cash flow $973MM beat TPHe/Street $846MM/$866MM, driven by a combination of realizations, tport / G&A, and production, which combined with better-than-expected capex of $465MM vs. TPHe/Street $489MM/$478MM drove a beat on non-GAAP FCF, as well ($508MM vs. TPHe/Street $357MM/$388MM). On ops, 209mbopd crude and condensate edged out TPHe/Street 208, with Permian outperformance more than offsetting Montney coming in marginally below expectations (on total production, Permian 219mboepd vs. TPHe/Street 211 and Montney 305 vs. TPHe/Street 314/312). Beyond the print, the shareholder returns update is the key highlight in our view, particularly around the enhancement of the framework for both 2026 (>75% of non-GAAP FCF; TPHe model assumed 75% after the Anadarko asset sale announcement) and longer-term," analyst Jeoffrey Lambujon wrote.
(MT Newswires covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www.mtnewswires.com/contact-us)
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