These two oil sands firms are set to improve shareholder returns

Everyday roundup of research and analysis from The World and Mail’s sector strategist Scott Barlow

BMO oil and gasoline analyst Randy Ollenberger sees oil sands providers, particularly Cenovus Energy Inc. (CVE-T) and Canadian Normal Assets Ltd. (CNQ-T), returning a lot more to shareholders,

“With financial leverage substantially bettering across the oil sands group, we assume business priorities in 2023 will change towards expanding shareholder returns instead than more financial debt reduction … Cenovus Prospects the Way. Although lots of producers have define d a internet credit card debt ground which will consequence in them returning 100% of cost-free hard cash movement to shareholders, Cenovus will be the first to attain this. We be expecting the enterprise to access its remaining internet debt goal of $4 billion all-around year -stop 2022 , and will start off distributing fundamentally all of its totally free income movement to shareholders in 2023 via a mix of foundation dividends, variable dividends and share buybacks. As a end result, we believe Cenovus will have the greatest total funds return produce inside its peer group in 2023, whilst we anticipate Canadian Natural to return the most on an absolute basis”


Morgan Stanley analyst Stephen Byrd identified 6 symptoms that ESG investing will accelerate in 2023,

Trend #1: In our check out, Fee of Alter investing will grow in reputation. Our latest be aware focused on ESG Level of Improve was just one of the most go through stories at Morgan Stanley in 2022, and opinions was supportive of the principle of ‘embracing the improvers’ — the gains of investing in shares that (i) are foremost the way on enhancing ESG metrics, (ii) are demonstrating a level of transform that can make tangible monetary positive aspects this sort of as profits/margin development and chance reduction, and (iii) offer you attractive possibility-reward skews … ESG standards in valuation, with investors interested in better comprehension … Craze #2: We assume to see continued development in the adoption and integration of ESG’s impact on financials and stock performance. In accordance to The Financial investment Association’s (IA) Once-a-year Survey in 2021, all over 50 % (47%) of the ~100 associates surveyed have been integrating ESG into their expenditure procedures … Pattern #3: An improved concentration on the interconnected effects of weather alter especially related to physical possibility, drinking water availability, foods pricing/shortage, and biodiversity. Pattern #4: Regulatory evolution — Price of Change and the dual aims of Vitality Stability and an efficient Strength Changeover. .. Pattern #5: Worldwide Provide Chain and Labor, Worker Expertise, and Details Privateness and Security… We think social concerns will stay in the forefront for ESG investors in 2023 and see subjects on the world-wide source chain and labor staying of elevated value. We also anticipate to see traders keep on to observe trends on human capital/personnel working experience … Pattern #6: Additional scrutiny of governance enhancements, with much more emphasis on transparency and alignment with shareholder pursuits.


BofA U.S. quantitative strategist Savita Subramanian supplied trader direction in the most recent version of her Relative Price Cheat Sheet,

“The S&P 500 however screens as statistically costly vs. history on 17 out of 20 of the steps we monitor . In advance of prior market place bottoms, the index screened as costly on just 4 measures, on normal. Prior troughs noticed the S&P trade under its regular fwd P/E, trailing normalized PE, and median fwd P/E steps, but it trades higher than typical on all a few right now … Wall Avenue strategists aggressively elevated publicity to bonds relative to shares by +6ppt in 2022, just one of the greatest moves in history … Also, hedge funds are now 40% internet extended Utilities, the most bond-like sector in the S&P 500 … US Financials may be a good spot to park assets in the close to-time period. It has shot to #1 in our small-time period sector design, dethroning Electrical power right after its 18-thirty day period streak. Financials is investing at a relative price cut to its ordinary marketplace numerous on all actions we monitor, but compared with similarly low-cost Health and fitness Treatment and Power which observed an improve in relative publicity of energetic money in 2022, Financials saw a fall in publicity in 2022 and sits shut to a 10% underweight in the regular lively US mutual fund”.

“Energy no for a longer period prime rated sector at BofA” – (investigate excerpt) Twitter


Diversion: “Winners of the 2022 Near-Up Photographer of the Year” – The Atlantic

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