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1. Company Snapshot

1.a. Company Description

Canadian Natural Resources Limited acquires, explores for, develops, produces, markets, and sells crude oil, natural gas, and natural gas liquids (NGLs).The company offers synthetic crude oil (SCO), light and medium crude oil, bitumen (thermal oil), primary heavy crude oil, and Pelican Lake heavy crude oil.Its midstream and refining assets include two crude oil pipeline systems; and a 50% working interest in an 84-megawatt cogeneration plant at Primrose.


As of December 31, 2020, the company had total proved crude oil, bitumen, and NGLs reserves were 10,528 million barrels (MMbbl); total proved plus probable crude oil, bitumen, and NGLs reserves were 13,271 MMbbl; proved SCO reserves were 6,998 MMbbl; total proved plus probable SCO reserves were 7,535 MMbbl; proved natural gas reserves were 12,168 billion cubic feet (Bcf); and total proved plus probable natural gas reserves were 20,249 Bcf.It operates primarily in Western Canada; the United Kingdom portion of the North Sea; and Offshore Africa.The company was formerly known as AEX Minerals Corporation and changed its name to Canadian Natural Resources Limited in December 1975.


Canadian Natural Resources Limited was incorporated in 1973 and is headquartered in Calgary, Canada.

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1.b. Last Insights on CNQ

Canadian Natural Resources' recent stock performance was negatively driven by a 4.35% earnings miss in Q4 2024, partly due to declining oil prices and reduced refining margins. The company's revenue growth of 5.88% was not enough to offset the disappointing earnings surprise. Additionally, the decline in oil prices and reduced refining margins are expected to impact future earnings, as indicated by a 16% earnings miss in the latest earnings release.

1.c. Company Highlights

2. Canadian Natural's Q3 2025 Earnings: A Record-Breaking Quarter

Canadian Natural reported a stellar Q3 2025, with adjusted net earnings of $1.8 billion and adjusted funds flow of approximately $3.9 billion. The company's earnings per share (EPS) came in at $0.871, beating analyst estimates of $0.785. Revenue growth was driven by record corporate production, with 1.62 million BOEs per day, a 19% increase from Q3 2024 levels. The company's strong financial performance was underpinned by its diversified asset base, with liquids production totaling approximately 1.18 million barrels per day and natural gas production reaching 2.7 Bcf per day.

Publication Date: Nov -07

📋 Highlights
  • Record Production Growth:: 1.62 million BOEs/day, 19% higher than Q3 2024, with liquids at 1.18 million bbls/day and 2.7 Bcf/day of natural gas.
  • AOSP Swap Acquisition:: Added 31,000 barrels/day of zero-decline bitumen production via the Shell Canada deal, boosting operational integration.
  • Strong Financial Performance:: Adjusted funds flow of $3.9B and adjusted net earnings of $1.8B, with $1.5B returned to shareholders ($1.2B dividends, $300M buybacks).
  • Robust Balance Sheet:: Debt-to-EBITDA at 0.9x, debt-to-book capital at 29.8%, and a $0.5875/share dividend approved for January 2026.
  • Capital Budget Outlook:: 2026 capital spending to rise modestly, with Horizon plant turnaround planned in Q3 2026 and stable operational performance across assets.

Operational Highlights

The company's operational performance was a key driver of its financial results, with Scott Stauth stating that "all assets are performing as expected, with strong optimization utilization." The company's record production levels were driven by strong performance from organic growth and accretive acquisitions, including the AOSP swap with Shell Canada Limited, which added approximately 31,000 barrels per day of annual zero-decline bitumen production.

Valuation and Returns

Canadian Natural's valuation metrics suggest that the company is trading at a reasonable multiple, with a P/E Ratio of 11.18 and a Dividend Yield of 6.16%. The company's Return on Equity (ROE) stands at 20.66%, indicating a strong ability to generate returns for shareholders. The Net Debt / EBITDA ratio of 0.93x suggests that the company's balance sheet remains healthy, providing flexibility for future investments and returns to shareholders.

Macro Outlook and Guidance

The company's management expects light heavy differentials to remain in the range of $10 to $13 a barrel, supported by strong demand from Asia for Canadian heavy crude. Analysts estimate next year's revenue growth at -3.1%, but Canadian Natural's diversified asset base and strong operational performance position the company well to navigate any potential challenges. The company's allocation policy remains straightforward, with a focus on returning value to shareholders through dividends and share repurchases.

Future Plans and Risks

Canadian Natural is scheduled to undergo a significant turnaround at its Horizon asset in the third quarter of 2026. The company's management has indicated that expenditure levels are expected to increase modestly in 2026, with a 75% tax recovery expected on next 5 years' expenditure. The company's strong financial position and diversified asset base provide a solid foundation for navigating any potential risks and capitalizing on opportunities in the energy sector.

3. NewsRoom

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Eni Launches Congo LNG Phase 2 as FLNG Nguya Arrives Offshore Congo

Dec -04

Source: zacks.com

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Is It Too Late To Consider Canadian Natural Resources After Its Strong Multi Year Share Price Run?

Dec -04

Source:

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Chevron Initiates Discussions With Syria Over Oil and Gas Exploration

Dec -03

Source: zacks.com

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Is Canadian Natural Resources Limited (CNQ) Stock Outpacing Its Oils-Energy Peers This Year?

Dec -03

Source:

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How CNQ Turned Dividend Discipline Into Long-Term Strength

Dec -03

Source:

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Valvoline Closes Breeze Autocare Deal, Boosts Growth Strategy

Dec -03

Source: zacks.com

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BP Abandons H2Teesside Carbon Capture & Hydrogen Scheme Amid AI Push

Dec -02

Source:

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USA Compression Announces Acquisition of J-W Power for $860 Million

Dec -02

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.00%)

6. Segments

Exploration and Production - North America

Expected Growth: 5.5%

The North American E&P segment is expected to grow at 5.5% due to continued drilling activities, operational efficiency, and the potential for new discoveries. The region's mature infrastructure and diversified assets support growth. The segment's production is influenced by commodity prices, and the company is expected to optimize production through technology and cost management, driving growth above the global average.

Oil Sands Mining and Upgrading

Expected Growth: 4.5%

The Oil Sands Mining and Upgrading segment is expected to grow at 4.5%, driven by cost reduction initiatives, operational improvements, and the demand for high-quality synthetic crude oil. However, the segment's growth is constrained by high production costs and potential project delays. The company's focus on operational efficiency is expected to support growth, albeit at a slower rate than other segments.

Exploration and Production - North Sea

Expected Growth: 3.0%

The North Sea E&P segment is expected to grow at 3.0%, driven by cost management and technology optimization. However, the segment's mature assets and declining production constrain growth. The UK's regulatory environment and commodity prices also influence the segment's performance. The company's focus on operational efficiency is expected to slow the decline in production.

Exploration and Production - Offshore Africa

Expected Growth: 5.0%

The Offshore Africa E&P segment is expected to grow at 5.0%, driven by continued exploration and production activities, operational efficiency, and the demand for oil. The segment's diverse assets and potential for new discoveries support growth. However, the segment is subject to geopolitical risks and operational challenges, which are expected to be managed through the company's operational expertise.

Midstream and Refining

Expected Growth: 5.2%

The Midstream and Refining segment is expected to grow at 5.2%, driven by stable cash flows, operational efficiency, and the demand for refined products. The segment's critical role in the company's overall operations supports growth. The company's focus on operational efficiency and cost management is expected to drive growth above the global average.

Inter-Segment Elimination and Other

Expected Growth: 5.0%

The Inter-Segment Elimination and Other segment is expected to grow at 5.0%, in line with the global growth hypothesis. The segment's growth is not directly related to operational performance, but rather to the company's overall financial performance and corporate activities.

7. Detailed Products

Crude Oil

Canadian Natural Resources Limited is a major producer of crude oil, with operations in Western Canada, the North Sea, and Offshore Africa.

Natural Gas

The company produces natural gas from its operations in Western Canada and Offshore Africa.

Natural Gas Liquids (NGLs)

Canadian Natural Resources Limited produces NGLs, including ethane, propane, and butane, from its natural gas operations.

Bitumen

The company produces bitumen, a heavy, thick oil, from its oil sands operations in Alberta, Canada.

Synthetic Crude Oil (SCO)

Canadian Natural Resources Limited produces SCO from its oil sands operations, which is a high-quality, light oil.

Pelican Lake Heavy Oil

The company produces heavy oil from its Pelican Lake operations in Alberta, Canada.

8. Canadian Natural Resources Limited's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Canadian Natural Resources Limited is medium due to the availability of alternative energy sources such as renewable energy and natural gas.

Bargaining Power Of Customers

The bargaining power of customers for Canadian Natural Resources Limited is low due to the company's diversified customer base and lack of dependence on a single customer.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Canadian Natural Resources Limited is medium due to the company's dependence on a few key suppliers for critical materials and equipment.

Threat Of New Entrants

The threat of new entrants for Canadian Natural Resources Limited is low due to the high barriers to entry in the oil and gas industry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry for Canadian Natural Resources Limited is high due to the competitive nature of the oil and gas industry, with many established players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 21.79%
Debt Cost 6.91%
Equity Weight 78.21%
Equity Cost 13.81%
WACC 12.31%
Leverage 27.86%

11. Quality Control: Canadian Natural Resources Limited passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Canadian Natural Resources

A-Score: 6.6/10

Value: 6.1

Growth: 5.6

Quality: 6.9

Yield: 10.0

Momentum: 3.0

Volatility: 8.3

1-Year Total Return ->

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EOG Resources

A-Score: 6.4/10

Value: 5.9

Growth: 5.7

Quality: 7.8

Yield: 8.0

Momentum: 2.5

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
Diamondback Energy

A-Score: 6.2/10

Value: 7.4

Growth: 7.8

Quality: 6.3

Yield: 7.0

Momentum: 2.0

Volatility: 6.7

1-Year Total Return ->

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Stock-Card
Devon Energy

A-Score: 6.0/10

Value: 8.1

Growth: 5.2

Quality: 5.9

Yield: 8.0

Momentum: 2.5

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Hess

A-Score: 5.7/10

Value: 3.6

Growth: 7.1

Quality: 6.6

Yield: 2.0

Momentum: 6.0

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
ConocoPhillips

A-Score: 5.6/10

Value: 6.0

Growth: 5.1

Quality: 6.5

Yield: 6.0

Momentum: 2.5

Volatility: 7.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

47.96$

Current Price

47.96$

Potential

-0.00%

Expected Cash-Flows