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Cavvy Energy
(TSX:CVVY)
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Rating:69Neutral
Price Target:
C$2.50
▲(34.41% Upside)
Action:Downgraded
Date:08/28/26
The score is driven primarily by improving financial performance (strong TTM free cash flow and reduced leverage) and an upbeat earnings call with raised guidance and meaningful hedging that improves forward cash-flow visibility. Technicals support the trend but look near-term stretched (RSI ~74.5). The biggest drag is valuation, with a very high P/E and no dividend yield support.
Positive Factors
Upgraded earnings and cash-flow outlook
Higher guidance, record netbacks, and sharply improved funds flow indicate stronger operating performance and better internal funding capacity. If maintained, this can support productive investment and debt reduction while improving the company’s earnings resilience over the next several quarters.
Negative Factors
Thin and historically volatile profitability
A low net margin leaves limited protection when commodity prices, royalties, or operating costs move unfavorably. Recent losses also show that earnings power has not yet been consistent through the cycle, making future results more sensitive to market conditions than those of stronger-margin peers.
Read all positive and negative factors
Positive Factors
Negative Factors
Upgraded earnings and cash-flow outlook
Higher guidance, record netbacks, and sharply improved funds flow indicate stronger operating performance and better internal funding capacity. If maintained, this can support productive investment and debt reduction while improving the company’s earnings resilience over the next several quarters.
Read all positive factors
Cavvy Energy (CVVY) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$610.48M
Dividend Yield20.75%
Average Volume (3M)584.63K
Price to Earnings (P/E)71.5
Beta (1Y)0.50
Revenue Growth42.92%
EPS GrowthN/A
CountryCA
Employees257
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)0.03
Shares Outstanding296,351,260
10 Day Avg. Volume653,432
30 Day Avg. Volume584,634
Financial Highlights & Ratios
PEG Ratio0.59
Price to Book (P/B)1.91
Price to Sales (P/S)1.21
P/FCF Ratio20.15
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.15
Revenue Forecast (FY)C$400.00M
Cavvy Energy Business Overview & Revenue Model
Company Description
Cavvy Energy Ltd., an integrated energy company based in Calgary, Canada, operates across both upstream and midstream sectors. The firm focuses on the development, production, and processing of natural gas, natural gas liquids, condensate, and sul...
Cavvy Energy Earnings Call Summary
Earnings Call Date:Aug 11, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call presented strong positive operational and financial momentum: record operating netback, materially higher cash flow, rapid debt reduction, midstream volume/revenue growth, and a secured sulfur hedge that provides significant 2027 cash‑flow certainty. Challenges were operational (Waterton unplanned outage, upcoming turnarounds), several shut‑in volumes that remain inactive, some realized-price timing/lag effects and higher royalties, and a planned moderation of debt paydown in H2 to fund productive capital. On balance the favorable cash‑flow and balance sheet progress, plus the meaningful sulfur hedging and midstream growth, outweigh the operational and price‑timing negatives.Positive Updates
Record Quarterly Cash Flow and Net Operating Income
Net operating income near $50M in Q2 (up 87% YoY). Funds flow from operations just under $42M (up 189% YoY).
Negative Updates
Unplanned Waterton Outage and Reliability Risk
Waterton had 24 days scheduled downtime in Q2 and after restart developed a cracked low‑pressure acid gas knockout vessel on July 19 requiring an ~4‑week outage and modest Q3 impact. Management flagged facility reliability as a key performance risk.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Quarterly Cash Flow and Net Operating Income
Net operating income near $50M in Q2 (up 87% YoY). Funds flow from operations just under $42M (up 189% YoY).
Read all positive updates
Company Guidance
Cavvy raised 2026 net operating income guidance to $170–$180M (from $125–$140M) and increased 2026 capital to $52–$57M (from $35–$40M) — adding ~$7M for optimization, ~$6M for maintenance and ~$4M for other initiatives — while revising year‑end total debt to $75–$85M after repaying $76.5M YTD (including ~$39M in Q2) and leaving $86.8M principal at quarter end; Q2 operating metrics included ~21.5k BOE/d production (80% gas / 20% liquids), 984 tpd sulfur, ~152 MMcf/d third‑party processing (volumes +27% YoY, revenues +26% YoY) and >$40M expected midstream revenue for 2026, with Q2 net operating income ~ $50M, funds flow ~ $42M, record operating netback $25.38/BOE, realized gas $2.81/GJ (market $1.52), condensate CAD102.86/bbl (market CAD129.70), and realized sulfur CAD478/t (market CAD877/t) — hedges include 66.7k GJ/d gas at $3.40/GJ and ~1.48k bbl/d condensate at CAD85.71/bbl (~53% of midpoint hydrocarbon production), plus a 2027 sulfur fixed sale of 200k t (~50% of production) at US$525/t (locking >$100M of 2027 net revenue); debt maturities are $39M Mar‑2027 (no penalty) and $48M Sep‑2027 (make‑whole), current debt costs are SOFR+6.75% and 13% sub‑debt, management is pursuing refinancing to sub‑10% rates and greater revolver flexibility, expects Waterton outage to last ~4 weeks and Caroline turnaround in early September, and will modestly slow H2 debt repayment to fund higher 2026 capital but plans to reaccelerate repayments in Q1‑2027.Cavvy Energy Financial Statement Overview
Summary
Income Statement
61
Positive
Balance Sheet
66
Positive
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 282.24M | 217.91M | 222.77M | 368.14M | 443.58M | 321.81M |
| Gross Profit | 96.83M | -9.63M | 141.54M | 60.98M | 143.54M | 79.33M |
| EBITDA | 60.58M | -1.66M | 36.87M | 103.96M | 176.49M | 52.96M |
| Net Income | 8.00M | -4.87M | -38.91M | 8.98M | 146.58M | -39.68M |
Balance Sheet | ||||||
| Total Assets | 560.42M | 569.39M | 612.42M | 638.54M | 615.48M | 622.54M |
| Cash, Cash Equivalents and Short-Term Investments | 40.19M | 5.80M | 8.58M | 18.33M | 22.27M | 26.22M |
| Total Debt | 85.60M | 155.35M | 172.51M | 175.73M | 206.94M | 234.31M |
| Total Liabilities | 390.62M | 430.85M | 444.00M | 464.13M | 500.72M | 655.75M |
| Stockholders Equity | 169.80M | 138.55M | 168.43M | 174.75M | 115.10M | -32.83M |
Cash Flow | ||||||
| Free Cash Flow | 105.33M | 13.12M | -18.57M | 48.66M | 48.64M | 16.20M |
| Operating Cash Flow | 129.85M | 36.45M | 7.13M | 104.20M | 88.17M | 51.12M |
| Investing Cash Flow | -22.98M | -22.39M | -18.15M | -58.90M | -28.86M | -33.51M |
| Financing Cash Flow | -73.39M | -16.84M | 1.26M | -49.25M | -63.10M | -2.80M |
Cavvy Energy Technical Analysis
Positive
1.86
Price Trends
1.77
Positive
1.66
Positive
1.33
Positive
Market Momentum
0.11
Negative
56.73
Neutral
61.11
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:CVVY, the sentiment is Positive. The current price of 1.86 is below the 20-day moving average (MA) of 1.98, above the 50-day MA of 1.77, and above the 200-day MA of 1.33, indicating a bullish trend. The MACD of 0.11 indicates Negative momentum. The RSI at 56.73 is Neutral, neither overbought nor oversold. The STOCH value of 61.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:CVVY.
Cavvy Energy Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | C$392.48M | 10.28 | 27.62% | 6.08% | 28.63% | 24.06% | |
69 Neutral | C$610.48M | 71.53 | 5.33% | 20.75% | 42.92% | ― | |
67 Neutral | C$269.48M | -116.13 | -0.66% | 6.67% | 25.52% | -126.16% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
56 Neutral | C$395.32M | 15.59 | 7.79% | ― | 15.04% | -61.00% | |
49 Neutral | C$376.84M | 8.69 | 57.31% | 8.00% | 39.79% | ― |
* Energy Sector Average
TSE:CVVY
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2.06
1.38
202.94%
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Cavvy Energy Corporate Events
Business Operations and StrategyFinancial Disclosures
Cavvy Energy Leverages Record Sulphur Prices to Boost Q2 Earnings and Accelerate Debt Reduction
Positive
Aug 12, 2026
Cavvy Energy reported strong second-quarter 2026 results, driven by record sulphur revenues and robust third-party gas processing activity, despite lower production volumes caused by scheduled plant downtime. Net operating income rose 87% year ove...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.