Ovintiv moved to Overweight at JPM with shares trading below Permian, Montney peers

2026년 2월 26일 · Unknown · financial · 출처 Seeking Alpha

[Pumpjack (oil derrick) and refinery power plant in West Texas]
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Ovintiv (OVV [https://seekingalpha.com/symbol/OVV]) -2% in Wednesday's trading despite winning an Overweight rating and a $58 price target from a Not Rated designation at J.P. Morgan, saying the shares continue to trade at a discounted multiple compared to its Permian and Montney peers.

Ovintiv (OVV [https://seekingalpha.com/symbol/OVV]) has prudently completed a significant portfolio transformation without sacrificing balance sheet strength, JPM's Arun Jayaram said, noting it has added ~1,880 locations in the Montney and 1,350 in the Permian Basin.

The analyst said his favorable thesis is based on anticipation that the stock will re-rate relative to peers given the streamlining of the portfolio to franchise assets in the core of the Midland and Montney basins following the jettisoning of its legacy positions in the Anadarko Basin, Uinta, Bakken, and Eagle Ford over the past several years.

On the back of the recent $3B sale of its Anadarko Basin sale assets, Jayaram noted Ovintiv (OVV [https://seekingalpha.com/symbol/OVV]) expects to lower its net debt to $3.6B from $5.2B - below the company's $4B net debt target - including the repayment of $459M of debt due in early 2026 and $280M of NuVista debt.

As a result, the company announced a revised shareholder return framework with its Q4 2025 earnings print and said it expects to return at least 75% of free cash flow to shareholders for 2026 while continuing to return 50%-100% of FCF over the long term.