Earnings Previews: Cenovus Energy, Discovery, Norwegian Cruise Lines

More than 1,500 companies are expected to report quarterly earnings this week. Of nine in our watch list for Monday morning, three missed profit estimates and four missed revenue estimates. ON Semiconductor reported a beat on both profits and revenue and raised full-year profit and revenue guidance above prior estimates. Shares traded up about 10% Monday morning.

We already have previewed two companies expected to report results after markets close Monday and one more that has not announced a report date yet, but often chooses this week to report prior quarter results: AMC, Diamondback Energy and NXP Semiconductors.

Our previews of three firms scheduled to report results before markets open on Tuesday (BP, Pfizer, Under Armour) and three more due after the closing bell (Activision-Blizzard, Lyft and T-Mobile) are also posted.

Here’s a look at three companies scheduled to report results first thing on Wednesday.

Cenovus Energy

Cenovus Energy Inc. (NYSE: CVE) is sometimes referred to as a mini-major integrated oil company. Based in Calgary, the company owns 50% of a refinery near Salt Lake City and 50% of another near Amarillo, Texas. Cenovus’s share price has risen by 208% over the past 12 months, including 99% in the year to date. Rising crude oil prices have played the biggest part in the share price increase. With a market cap of around $24.5 billion, Cenovus is about one-tenth the size of either Chevron or Exxon, America’s two supermajor integrated oil firms.

No surprise that analysts are unanimous in their bullish outlook for the company. All 20 rate the stock as a Strong Buy or a Buy. At a recent price of around $12.10 per share, the stock’s upside potential based on an average price target of $14.50 is 19.8%. At a high price target of $17.75, the upside potential is about 47%.

The company’s merger with Husky earlier this year affects the year-over-year comparisons. For the third quarter, revenue is forecast at $9.48 billion, which would be up 5.8% sequentially and $2.86 billion higher than last year. Adjusted earnings per share (EPS) are forecast at $0.38, up 271% sequentially and compared with a loss of $0.28 per share a year ago. For the full year, analysts expect EPS of $0.95, much better than last year’s loss per share of $1.66, on sales of $33.38 billion, up nearly 213%.

The stock trades at 12.7 times expected 2021 EPS, 7.4 times estimated 2022 earnings and 7.3 times estimated 2023 earnings. The stock’s 52-week range is $3.25 to $12.24. The high was posted Monday morning. Cenovus pays an annual dividend of $0.05 (yield of 0.46%).

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