Stryker shares tumble despite strong Q2 results and raised guidance
Investing.com - Goldman Sachs upgraded Ovintiv Inc. (NYSE:OVV) from Neutral to Buy on Monday, while raising its price target to $51.00 from $47.00. According to InvestingPro data, the company currently trades at an attractive P/E ratio of 16x and shows a healthy EV/EBITDA of 3.7x.
The investment bank cited an attractive risk/reward profile for Ovintiv shares compared to larger cap diversified E&P peers including EOG, OXY, DVN, CTRA, and APA.
Goldman Sachs highlighted Ovintiv’s recent strategic moves, including the divestiture of higher-cost Uinta assets and the acquisition of deeper, more capital efficient Montney inventory, which have positively shifted the company’s inventory position.
The firm noted that Ovintiv’s free cash flow generation now trades at a "meaningful discount" relative to its larger cap diversified E&P peers, creating an attractive entry point for investors.
Goldman Sachs also pointed to Ovintiv’s exposure to potential natural gas price increases as being "underappreciated," with the firm expecting "more upside relative to downside risk" for Henry Hub commodity prices in the next 12-18 months as LNG export capacity increases.
In other recent news, Ovintiv Inc. has been in the spotlight due to several significant developments. Fitch Ratings revised its outlook for Ovintiv to positive from stable, affirming its ’BBB-’ rating. This change is attributed to the company’s progress in debt reduction and recent acquisitions, which have enhanced its business profile. Ovintiv’s acquisitions in the Montney and Permian regions have expanded its production capabilities and improved its long-term inventory position. The company has also been actively involved in financial strategies, including share repurchases and dividend payouts, while maintaining a focus on debt repayment. Additionally, Ovintiv has been contacted by Democratic senators, including Elizabeth Warren, regarding its lobbying activities related to a new tax bill. The senators are concerned about potential tax benefits for oil companies and have requested information on Ovintiv’s lobbying expenditures. These recent developments highlight Ovintiv’s strategic financial maneuvers and its involvement in broader industry discussions.
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