Opinions
Stan Wong
Canadian Natural Rsrcs
CNQ-T
DON'T BUY
Sep 04, 2025
Stock price when the opinion was issued
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He thinks crude oil will come back up. CNQ has an excellent management team and a diversity of production assets along with a huge portfolio of assets. Production is good and Capex is under control. It is at a compelling valuation and has the lowest cost and longest reserve of similar companies in Canada. It offers great downside protection. It can sustain its dividend and last year returned $7.1 billion to investors which should be repeated this year. It also got rid of $2 billion in debt. Buy 16 Hold 6 Sell 0
(Analysts’ price target is $52.38)
Premium contentThere is simply no better diversified company in the Canadian energy sector than CNQ. Quarterly cash reserves are growing again despite relatively lower energy prices, shares being bought back and debt retired -- good cash flow. It trades at 13x earnings, 2.1x book and supports a 20% ROE. Amazingly, the company has increased dividends for 25 consecutive years and the current yield is backed by a payout ratio under 60% of cash flow. We recommend setting a stop-loss at $32.00, looking to achieve $52.50 -- upside potential of 26%. Yield 5.7%
(Analysts’ price target is $52.17)In a flat or questionable oil price environment, this former darling is being sold as a relative trade. Take advantage of that. Best operator in the business. Just inked first natural gas contract off an LNG project in the US. Own it long term and do well. Yield is 5.7%.
(Analysts’ price target is $52.38)Definitely don't sell. If you have extra funds, buy more. Happy to buy around low $40s. Premium assets, lower decline rate. Nice mix of oil and gas. Premium management team, one of the best in the world. FCF returned to shareholders via buybacks, consistent dividend increases. Another one to own forever. Has never cut the dividend, now 5.5%.
It has light and heavy oil as well as natural gas and LNG so it can switch around to what's going well and follow the increase in price of the particular commodity. It is the most diversified in Canada so is the one to buy. One of the cheaper at 12X earnings. It is a solid long term performer and has raised its dividend each year for 25 years. On oil in general OPEC has been putting more barrels on the market.
Premium contentOne of the best-managed Canadian companies that exist. Attractive today, mainly because we don't need a huge breakout in oil prices to deliver a decent return. WTI is sitting ~$61-62. Best consolidator in the basin. Core part of your energy allocation, though not quite a screaming buy today.
Bit of a downtrend for past year or so. 200-day MA has been falling, with stock price consistently below that. Not meeting some of his technical factors. Dividend remains steady, may increase depending on how oil prices go. Oil down and oversupplied. Yield is 5.4%.