Cenovus Energy and Valero Energy have both delivered strong returns over the past year, with Cenovus shares surging 81% and Valero gaining 78.6%, significantly outperforming the industry's 28.1% return. Cenovus, an integrated energy company with upstream oil sands and downstream refining operations, has been bolstered by the successful integration of its C$7.1 billion acquisition of MEG Energy, which is expected to generate annual synergies exceeding C$400 million by 2028. Valero, a leading independent refiner with 14 North American refineries and nearly 3 million barrels per day of capacity, continues to benefit from favorable heavy crude price differentials and a highly sophisticated refining network. From a valuation standpoint, Cenovus trades at a trailing 12-month EV/EBITDA multiple of 6.21X, compared to Valero's 7.34X, making it appear less expensive. While both stocks carry a Zacks Rank #3, Cenovus' lower valuation, long-term growth opportunities, and disciplined capital allocation strategy make it the more attractive choice at present.
Cenovus Energy IncSuccessful integration of MEG Energy acquisition expected to generate over C$400 million annual synergies by 2028, plus lower valuation and disciplined capital allocation.
Valero Energy CorporationMentioned as a comparison; benefits from heavy crude differentials but no specific news event affecting Valero directly.