3 Days Left To Cenovus Energy Inc (TSE:CVE)’s Ex-Dividend Date, Should Investors Buy?

Investors who want to cash in on Cenovus Energy Inc’s (TSX:CVE) upcoming dividend of CA$0.05 per share have only 3 days left to buy the shares before its ex-dividend date, 14 June 2018, in time for dividends payable on the 29 June 2018. Should you diversify into Cenovus Energy and boost your portfolio income stream? Well, keep on reading because today, I’m going to look at the latest data and analyze the stock and its dividend property in further detail. Check out our latest analysis for Cenovus Energy

5 questions I ask before picking a dividend stock

If you are a dividend investor, you should always assess these five key metrics:

• Does it pay an annual yield higher than 75% of dividend payers?

• Has it consistently paid a stable dividend without missing a payment or drastically cutting payout?

• Has dividend per share amount increased over the past?

• Can it afford to pay the current rate of dividends from its earnings?

• Will it have the ability to keep paying its dividends going forward?

TSX:CVE Historical Dividend Yield Jun 10th 18

How well does Cenovus Energy fit our criteria?

Cenovus Energy has a trailing twelve-month payout ratio of 21.02%, meaning the dividend is sufficiently covered by earnings. In the near future, analysts are predicting a higher payout ratio of 39.53%, leading to a dividend yield of 1.58%. However, EPS is forecasted to fall to CA$-0.05 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income. If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. Unfortunately, it is really too early to view Cenovus Energy as a dividend investment. It has only been consistently paying dividends for 9 years, however, standard practice for reliable payers is to look for a 10-year minimum track record. Relative to peers, Cenovus Energy produces a yield of 1.53%, which is on the low-side for Oil and Gas stocks.

Next Steps:

Now you know to keep in mind the reason why investors should be careful investing in Cenovus Energy for the dividend. But if you are not exclusively a dividend investor, the stock could still be an interesting investment opportunity. Given that this is purely a dividend analysis, I urge potential investors to try and get a good understanding of the underlying business and its fundamentals before deciding on an investment. Below, I’ve compiled three essential aspects you should further research:

1. Future Outlook: What are well-informed industry analysts predicting for CVE’s future growth? Take a look at our free research report of analyst consensus for CVE’s outlook.

2. Valuation: What is CVE worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether CVE is currently mispriced by the market.

3. Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.

To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.