09:25 AM EDT, 08/25/2025 (MT Newswires) -- Tudor, Pickering, Holt on Monday reiterated its buy rating on the shares of Cenovus Energy ( CVE ) with a C$28.00 price target after the oil producer and refiner on Friday said it agreed to acquire oil-sands producer MEG Energy (MEG.TO) for $7.9-billion, including debt.

"We like the deal especially for CVE given the price tag relative to NAV implied by long-term upside in crude; for MEG, the offer is in the ballpark of Strathcona Resources' (SCR CN; Not Covered; C$28.17/shr based on Thursday's (8/21) closing prices, vs. prices when the intent was announced May 15th implying the low-C$23/shr range), but with hands-down TPHe much greater industrial logic and preferable paper in CVE stock. From a valuation perspective, it's a good price for CVE in our view as the C$27.25/shr take-out price, while a slight premium to our Christina Lake NAV at TPHe C$25-26/shr using the most commonly requested mid-cycle price range of mid-$60s WTI long-term, provides a discount to longer-term upside in crude (TPHe ~C$30+/shr at $70 WTI long-term and ~C$34-35/shr at $75 WTI long-term). At first blush on our standalone numbers, the transaction is accretive to our FY'26 CFPS by TPHe high-single digits %, even only giving credit for the near-term synergies guidance of C$150MM, with C$400MM/year being the guide in 2028+ (SCR's materials spoke to C$175MM, for comparison)," analyst Jeoffrey Lambujon wrote.

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