We still like both

Article Excerpt

It’s been nearly a year since the old EnCana Corp. split itself into two separate companies: one that focuses on unconventional natural gas (Encana), and one that specializes in oil-sands projects (Cenvous Energy). Shareholders received one share in each of the two new firms for every old EnCana share they held. The new Encana has suffered, mostly because of a recent drop in natural gas prices. As well, Cenovus has faced pressure from environmentalists who are opposed to oil-sands development. But the breakup helped unlock hidden value. As a result, both stocks should produce above-average results in the next few years. ENCANA CORP. $30 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 736.2 million; Market cap: $22.1 billion; Price-to-sales ratio: 1.8; Dividend yield: 2.8%; SI Rating: Average) is one of North America’s largest natural-gas producers. The company prefers to focus on large unconventional reserves, including shale gas, which is natural gas that is trapped in rock formations. To extract it, companies…

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