Shares of the Canadian oil producer Crescent Point Energy (NYSE: CPG) have gained 27.9% in September while the S&P 500 is up just 1.5%. Yet, over the last 12 months, the stock price is down 28.0% while the S&P 500 is up 3.55%.
The recent strong performance is related to the price increase of the WTI -- the U.S. oil benchmark -- but the market still undervalues the company despite its improving situation.
Over the last several years, the company has increased its debt and diluted shareholders to grow its production. But, since the new management team took over last year, the company made a U-turn and prioritized net debt reduction. The strategy consisted of using the extra cash from a dividend cut, a reduced capital program, and some asset sales to decrease the debt load.