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Research Alert: Cnq Q1: 4% Volume Growth Offsets Pricing Headwinds, Larger Wti/wcs Differential

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-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

CNQ reported adjusted EPS of CAD1.17, flat Y/Y but beating consensus of CAD1.06, with total production up 4% to 1.64M boepd fueled by acquisitions and thermal pad additions. Adjusted funds flow declined 3% to CAD4.37B as wider WCS differentials to US$14.12/bbl offset volume gains and stronger natural gas pricing, while international production fell 61% due to planned abandonments. The raised 2026 production guidance of 1.615M-1.665M boepd, alongside revised lower operating capex forecast of CAD5.99B from CAD6.30B, demonstrates disciplined capital allocation. Management maintained strong financial flexibility with CAD6.17B liquidity, debt-to-book capitalization of 26.6% within target range, and increased quarterly dividend 6% to CAD0.625 while repurchasing CAD311M of shares. We believe the 15k boepd production guidance increase was positive, though significantly lower free cash flow from higher net capex reflects near-term investment priorities in growth assets.

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