Suncor Energy (TSE:SU) (NYSE:SU) reported better-than-expected results for the first quarter of 2023. The performance, however, compares unfavorably with the last year’s quarter due to lower crude oil realizations, higher expenses, a decline in upstream production, and weak crude oil pricing.
Suncor is a Canada-based integrated energy company that specializes in producing synthetic crude from oil sands.
The company reported adjusted operating earnings of C$1.81 billion or C$1.36 per share, down from C$2.76 billion or C$1.92 per share a year ago. Nevertheless, the bottom line surpassed the consensus estimate of C$1.32 per share.
Meanwhile, Q1 net operating revenue decreased to C$11.9 billion from C$13.3 billion but came in above analysts’ expectations of C$11.46 billion.
Furthermore, total upstream production reached 742,100 barrels of oil equivalent per day (boe/d) in the first quarter, down from 766,100 boe/d a year earlier.
Regarding the outlook, Suncor raised the production range for the Exploration and Production segment to 50,000 bbls/d – 60,000 bbls/d, from the 65,000 bbls/d – 75,000 bbls/d it had previously guided for. The company, however, did not raise the company’s total production range target.
Is Suncor Stock a Buy or Sell?
Wall Street is cautiously optimistic about Suncor’s prospects, with a Moderate Buy consensus rating based on six Buys and four Holds. The average SU price target of $39.48 implies an upside potential of 31.6% over the next 12 months.
It is worth highlighting that analyst Menno Hulshof of TD Securities is the most accurate analyst in the case of SU stock. The analyst has had a 65% success rate on his 26 ratings on Suncor. Importantly, replicating Hulshof’s trades for a year would yield an average return of 19.1% per trade. Click on the image below to learn more.