Download PDF

1. Company Snapshot

1.a. Company Description

Suncor Energy Inc.operates as an integrated energy company.The company primarily focuses on developing petroleum resource basins in Canada's Athabasca oil sands; explores, acquires, develops, produces, transports, refines, and markets crude oil in Canada and internationally; markets petroleum and petrochemical products under the Petro-Canada name primarily in Canada.


It operates through Oil Sands; Exploration and Production; Refining and Marketing; and Corporate and Eliminations segments.The Oil Sands segment recovers bitumen from mining and in situ operations, and upgrades it into refinery feedstock and diesel fuel, or blends the bitumen with diluent for direct sale to market.The Exploration and Production segment is involved in offshore operations off the east coast of Canada and in the North Sea; and operating onshore assets in Libya and Syria.


The Refining and Marketing segment refines crude oil and intermediate feedstock into various petroleum and petrochemical products; and markets refined petroleum products to retail, commercial, and industrial customers through its other retail sellers.The Corporate and Eliminations segment operates four wind farms in Ontario and Western Canada.The company also markets and trades in crude oil, natural gas, byproducts, refined products, and power.


The company was formerly known as Suncor Inc.and changed its name to Suncor Energy Inc.in April 1997.


Suncor Energy Inc.was founded in 1917 and is headquartered in Calgary, Canada.

Show Full description

1.b. Last Insights on SU

Negative drivers behind Suncor Energy's recent performance include declining revenues, commodity price fluctuations, and risks associated with aging assets. The company's operational strength and long-term growth potential are overshadowed by these challenges. Additionally, Suncor's total capital expenditures for 2025 are expected to be between C$6.1 billion and C$6.3 billion, which may strain the company's resources. Furthermore, the company's expenses have increased by 6% year-over-year, which may impact its profitability.

1.c. Company Highlights

2. Suncor Energy's Strong Q3 2025 Earnings: A Testament to Operational Excellence

Suncor Energy's third-quarter 2025 financial results were impressive, with the company achieving several operational records. Adjusted Funds From Operations (AFFO) stood at $3.8 billion, with WTI at $65 a barrel. The company's earnings per share (EPS) came in at $1.49, beating analyst estimates of $1.16. Revenue growth, although not explicitly stated, is expected to decline by 2.3% next year according to analyst estimates. The company's upstream production reached 870,000 barrels per day, a record for the third quarter, while refining throughput was 492,000 barrels a day, also a record. Product sales were 647,000 barrels a day, the highest quarter ever. With a P/E Ratio of 12.93 and a Dividend Yield of 3.82%, the company's valuation appears reasonable, considering its ability to generate cash.

Publication Date: Nov -09

📋 Highlights

Operational Highlights and Guidance Revision

The company's operational performance was a key highlight, with production, refining throughput, and product sales all achieving records. The company has revised its 2025 volumes guidance upward, with production expected to be 845,000 to 855,000 barrels per day, refining throughput 470,000 to 475,000 barrels a day, and refined product sales 610,000 to 620,000 barrels a day. As Richard Kruger, the CEO of Suncor, noted, "high performance leads to higher expectations," and the company aims to create shareholder value through its focus on operational excellence.

Capital Allocation and Return to Shareholders

Suncor returned $1.4 billion to shareholders in the quarter, including $688 million in dividends and $750 million in share buybacks. The Board of Directors approved a 5% dividend raise, with an annualized dividend of $2.40 per share. The company's commitment to returning cash to shareholders is evident, and its ability to generate sustainable free cash flow supports this strategy. With a Free Cash Flow Yield of 11.64%, the company's shares appear attractive to income investors.

Debt Reduction and Capital Expenditure

The company is making progress on its debt reduction target, with Kris Smith noting that Suncor is ahead of schedule. The company aims to keep its capital expenditure below $6 billion per year, prioritizing quality investments and returns capital to shareholders through buybacks and dividend growth. With a Net Debt / EBITDA ratio of 0.77, the company's debt levels appear manageable.

Future Plans and Outlook

Suncor is focused on creating long-term value for its shareholders, with plans to increase Fort Hills volumes to 195,000-200,000 barrels per day in the next couple of years. The company will provide an update on its three-year plan early in the new year, which is expected to outline its strategy for delivering consistent returns to shareholders. With its integrated business model and ability to generate sustainable free cash flow, Suncor is well-positioned to create value for its shareholders.

3. NewsRoom

Card image cap

Renewed Momentum in Energy Stocks Suggests Sustainable Upswing. Which Charts Look Best?

Dec -02

Source:

Card image cap

TSX Dividend Stocks Including Canadian Imperial Bank of Commerce And 2 More Income Generators

Nov -28

Source:

Card image cap

CIBC Raises Price Targets on Suncor, Ovintiv

Nov -27

Source:

Card image cap

Is CNQ Still a Buy After Its Recent 52-Week High Breakout?

Nov -26

Source:

Card image cap

Suncor Energy (TSX:SU): Evaluating Valuation After Recent 12% Share Price Gain

Nov -26

Source:

Card image cap

How Analyst Views Are Shaping the Evolving Investment Story for Suncor Energy

Nov -25

Source:

Card image cap

Suncor's Steady Momentum: Why Holding the Stock Still Makes Sense

Nov -25

Source:

Card image cap

RBC Names Suncor Energy, Canadian Natural Resources as Top Picks in Integrated Oil, Exploration and Production Cos

Nov -24

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.53%)

6. Segments

Refining and Marketing

Expected Growth: 3.2%

Suncor Energy’s Refining and Marketing segment growth is driven by increasing demand for refined petroleum products, improvements in refining margins, and strategic investments in low-carbon initiatives.

Oil Sands

Expected Growth: 6.4%

Increasing global demand for heavy crude, Suncor’s low-cost bitumen production capacity expansion, and growing pipeline capacity are expected to drive growth in Suncor Energy Inc.’s Oil Sands segment.

Exploration and Production

Expected Growth: 5.4%

Suncor Energy Inc.'s oil and gas extraction operations are expected to grow driven by increasing crude oil prices, improved operational efficiency, and strategic investments in digital technologies.

Corporate and Eliminations

Expected Growth: 5.5%

Suncor Energy Inc.’s growth is driven by its strong operational performance, increasing production volumes, and strategic investments in the Canadian oil sands. The company’s integrated business model, diversified revenue streams, and commitment to reducing greenhouse gas emissions also contribute to its growth prospects.

7. Detailed Products

Crude Oil

Suncor Energy Inc. produces and sells crude oil, a raw material used to produce various petroleum products such as gasoline, diesel fuel, and jet fuel.

Refined Products

Suncor Energy Inc. refines crude oil into various petroleum products, including gasoline, diesel fuel, jet fuel, and lubricants.

Petrochemicals

Suncor Energy Inc. produces petrochemicals, such as ethylene and propylene, which are used to manufacture plastics, fibers, and other chemical products.

Wind Power

Suncor Energy Inc. generates electricity through wind power, a renewable energy source.

Biofuels

Suncor Energy Inc. produces biofuels, such as biodiesel and ethanol, which are blended with petroleum products to create a more environmentally friendly fuel.

8. Suncor Energy Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Suncor Energy Inc. faces moderate threat from substitutes due to the availability of alternative energy sources such as wind and solar power.

Bargaining Power Of Customers

Suncor Energy Inc. has a diverse customer base, which reduces the bargaining power of individual customers.

Bargaining Power Of Suppliers

Suncor Energy Inc. relies on a few major suppliers for its operations, giving them some bargaining power.

Threat Of New Entrants

The oil and gas industry has high barriers to entry, making it difficult for new entrants to compete with Suncor Energy Inc.

Intensity Of Rivalry

The oil and gas industry is highly competitive, with many established players competing for market share, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 22.17%
Debt Cost 8.32%
Equity Weight 77.83%
Equity Cost 11.39%
WACC 10.71%
Leverage 28.48%

11. Quality Control: Suncor Energy Inc. 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
Suncor Energy

A-Score: 7.1/10

Value: 7.1

Growth: 6.8

Quality: 6.2

Yield: 8.0

Momentum: 6.0

Volatility: 8.7

1-Year Total Return ->

View Full Report
Stock-Card
Imperial Oil

A-Score: 6.7/10

Value: 5.6

Growth: 7.7

Quality: 6.7

Yield: 5.0

Momentum: 7.0

Volatility: 8.3

1-Year Total Return ->

View Full Report
Stock-Card
Chevron

A-Score: 6.3/10

Value: 4.8

Growth: 5.0

Quality: 5.0

Yield: 8.0

Momentum: 5.0

Volatility: 9.7

1-Year Total Return ->

View Full Report
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 ->

View Full Report
Stock-Card
ExxonMobil

A-Score: 6.0/10

Value: 5.7

Growth: 5.0

Quality: 6.2

Yield: 7.0

Momentum: 2.5

Volatility: 9.7

1-Year Total Return ->

View Full Report
Stock-Card
Cenovus Energy

A-Score: 5.7/10

Value: 6.8

Growth: 5.8

Quality: 5.0

Yield: 6.0

Momentum: 4.0

Volatility: 6.3

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

61.19$

Current Price

61.19$

Potential

-0.00%

Expected Cash-Flows