Ovintiv's Cash Flows Exceed Our Expectations, Again

No-moat Ovintiv, formerly Encana, reported fourth-quarter results that exceeded our expectations for the second consecutive quarter. The company generated adjusted cash flow from operations of $692 million, a substantial increase from $398 million in the third quarter due to higher commodity prices, increased production levels, and lower cash costs. The company’s fourth-quarter production averaged 557 thousand barrels of oil equivalent per day with 215 mboe/d from crude oil and plant condensate. Production increased sequentially from 510 mboe/d due to management’s plan to restore previously shut-in production as commodity prices increased. Cash costs decreased to $11.60 a barrel from $11.77 in the third quarter.