NEW YORK (TheStreet) -- Shares of Cenovus Energy (CVE) are gaining, up 3.51% to $17.12 on heavy trading volume Tuesday afternoon, as the Canadian energy stocks are getting a boost after Spanish energy company Repsol SA agreed to buy Canada-based Talisman Energy (TLM) for $8.3 billion.
Repsol said Talisman will increase its output by 76% to 680,000 barrels of oil per day and boost reserves by 55%, the Associated Press reports.
Repsol said it would also take on $4.7 billion of Talisman debt, valuing the deal at $13 billion.
Under the terms of the deal, Talisman shareholders were being offered $8 per share, representing a 24% premium over the average share price of the last three months.
About 6.52 million shares of Cenovus Energy have traded hands as of 3:30 p.m. today, compared to its average daily trading volume of about 2.29 million shares.
Separately, TheStreet Ratings team rates CENOVUS ENERGY INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:
"We rate CENOVUS ENERGY INC (CVE) a HOLD. The primary factors that have impacted our rating are mixed, some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and feeble growth in the company's earnings per share."