Suncor Energy (SU) AI Stock Analysis

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Suncor Energy

(NYSE:SU)

76Outperform

Suncor Energy's overall stock score is driven by strong financial recovery, robust cash flow management, and positive corporate actions such as share buybacks and dividends. The stock's valuation is attractive, though current technical indicators suggest a bearish trend. The earnings call and corporate events provide a positive outlook, highlighting operational achievements and strategic focus. Investors should consider potential risks from market volatility and operational challenges.

Positive Factors

Cash Flow

Free cash flow for Suncor Energy was higher than expected due to lower capital expenditures.

Financial Performance

Suncor Energy reported strong performance from its Oil Sands and Refining segments.

Operational Performance

Suncor ended a remarkable year with a bang, achieving record quarterly and annual production.

Negative Factors

Geopolitical Risks

The possibility of US oil or refined product tariffs on Canada are a significant negative risk going forward.

Investor Expectations

Investor expectations are now higher in SU, with 4Q results supportive.

Market Valuation

Suncor no longer trades at a material EV/EBITDA discount to Canadian oil peers.

Suncor Energy (SU) vs. S&P 500 (SPY)

Market Cap

C$62.07B

Dividend Yield4.58%

Average Volume (3M)6.58M

Price to Earnings (P/E)10.4

Beta (1Y)1.00

Revenue Growth2.16%

EPS Growth-20.22%

CountryCA

Employees15,010

SectorEnergy

Sector Strength52

IndustryOil & Gas Integrated

Share Statistics

EPS (TTM)1.31

Shares Outstanding1,237,135,600

10 Day Avg. Volume8,227,710

30 Day Avg. Volume6,584,662

Financial Highlights & Ratios

PEG Ratio-0.47

Price to Book (P/B)1.57

Price to Sales (P/S)0.00

P/FCF Ratio7.17

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

C$59.16

Price Target Upside21.43% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering12

Suncor Energy Business Overview & Revenue Model

Company DescriptionSuncor Energy Inc. is a leading integrated energy company headquartered in Calgary, Alberta, Canada. The company operates primarily in the oil sands sector, with additional activities in exploration, production, refining, and marketing. Suncor is renowned for its oil sands operations in the Athabasca region of Canada, where it extracts and processes bitumen into synthetic crude oil and other petroleum products. The company also engages in offshore oil and gas production, operates refineries in Canada and the U.S., and markets petroleum and petrochemical products through its Petro-Canada retail network.

How the Company Makes MoneySuncor Energy generates revenue through a diversified model centered around its integrated operations. The primary revenue stream comes from the extraction and processing of oil sands in Alberta, where the company produces bitumen, which is then upgraded to synthetic crude oil. Suncor also earns income from conventional and offshore oil and gas production activities. In addition, Suncor owns and operates several refineries that convert crude oil into various refined products, including gasoline, diesel, and jet fuel. These products are distributed and sold through Suncor's extensive Petro-Canada retail network, which serves as an additional significant revenue source. Strategic partnerships and investments in renewable energy projects, as well as cost management and efficiency improvements, further contribute to Suncor's earnings.

Suncor Energy Financial Statement Overview

Summary

Suncor Energy has shown strong financial recovery with solid revenue growth and cash flow management post-2020. The income statement reflects improved revenue and gross margin, though the absence of EBIT in 2024 is a concern. The balance sheet is strong with improved leverage ratios, but declining ROE indicates potential efficiency issues. Overall, the financial health is robust, with strong cash flow supporting future investments and operations.

Income Statement

Positive

The company showed a strong recovery in revenue and profitability after the 2020 downturn. The gross profit margin for 2024 was approximately 40.8%, a notable improvement from 2020. However, the net profit margin dropped to 10.96% in 2024 from 16.9% in 2023. Revenue growth from 2023 to 2024 was 11.8%, indicating positive momentum, but the lack of EBIT in 2024 raises questions about operational efficiency.

Balance Sheet

Positive

The debt-to-equity ratio improved to 0.33 in 2024, reflecting a stronger equity base compared to liabilities. Return on equity was 13.52% in 2024, showing a decline from previous years, indicating reduced efficiency in generating profit from shareholders' equity. The equity ratio remained stable at 49.6%, suggesting a balanced capital structure.

Cash Flow

Positive

The company demonstrated strong cash flow generation capabilities with a free cash flow of $9.48 billion in 2024, a significant increase from 2023. The operating cash flow to net income ratio was 2.65, indicating robust cash generation relative to earnings. The free cash flow to net income ratio was 1.57, reflecting efficient capital expenditure management.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
54.88B	49.09B	58.34B	39.13B	24.66B
	Gross Profit
22.38B	19.54B	28.77B	19.49B	6.02B
	EBIT
0.00	8.68B	14.40B	6.70B	-5.26B
	EBITDA
15.84B	18.33B	22.28B	12.63B	2.55B
	Net Income Common Stockholders
6.02B	8.29B	9.08B	4.12B	-4.32B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.48B	1.73B	1.98B	2.21B	1.89B
	Total Assets
89.78B	88.54B	84.62B	83.74B	84.62B
	Total Debt
14.69B	15.80B	15.62B	18.35B	21.70B
	Net Debt
11.21B	14.08B	13.64B	16.15B	19.81B
	Total Liabilities
45.27B	45.26B	45.25B	47.13B	48.86B
	Stockholders Equity
44.51B	43.28B	39.37B	36.61B	35.76B
Cash Flow		Free Cash Flow
9.48B	6.52B	10.56B	7.21B	-1.25B
	Operating Cash Flow
15.96B	12.34B	15.68B	11.76B	2.67B
	Investing Cash Flow
-6.47B	-6.51B	-4.79B	-3.98B	-4.52B
	Financing Cash Flow
-7.88B	-5.99B	-11.23B	-7.46B	1.79B

Suncor Energy Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price48.72

Price Trends

50DMA

50.47

Negative

100DMA

52.34

Negative

200DMA

52.40

Negative

Market Momentum

MACD

-0.45

Negative

RSI

54.25

Neutral

STOCH

65.39

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:SU, the sentiment is Neutral. The current price of 48.72 is above the 20-day moving average (MA) of 48.43, below the 50-day MA of 50.47, and below the 200-day MA of 52.40, indicating a neutral trend. The MACD of -0.45 indicates Negative momentum. The RSI at 54.25 is Neutral, neither overbought nor oversold. The STOCH value of 65.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:SU.

Suncor Energy Peers Comparison

Overall Rating

UnderperformOutperform

Sector (56)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CNQ	79 Outperform	$89.28B	11.87	18.99%	5.18%	7.78%	4.75%
IMO	76 Outperform	$50.53B	10.64	20.61%	2.54%	1.26%	8.70%
SU	76 Outperform	C$62.07B	10.39	13.74%	4.58%	2.16%	-20.22%
PPL	74 Outperform	$29.99B	16.84	11.55%	5.35%	-5.42%	-1.70%
TRP	74 Outperform	$71.54B	16.36	15.89%	5.23%	0.72%	60.40%
CVE	73 Outperform	$33.65B	12.18	9.50%	3.91%	1.57%	-38.04%
Sector *	56 Neutral	$7.16B	3.85	-4.87%	5.83%	0.21%	-51.96%

* Energy Sector Average

Performance Comparison

TSE:SU

Suncor Energy

50.17

-1.82

-3.50%

TSE:CNQ

Canadian Natural

43.96

-5.76

-11.58%

TSE:TRP

TC Energy

67.33

21.95

48.37%

TSE:CVE

Cenovus Energy

19.16

-7.72

-28.72%

TSE:IMO

Imperial Oil

101.46

8.75

9.44%

TSE:PPL

Pembina Pipeline

51.77

3.89

8.13%

Suncor Energy Earnings Call Summary

Earnings Call Date:May 06, 2025

(Q1-2025)

% Change Since: 0.74%|

Next Earnings Date:Jul 23, 2025

Earnings Call Sentiment Positive

Suncor Energy's first-quarter earnings call highlighted a strong operational and financial performance, with record-breaking production and refining throughput, significant cost reductions, and strategic progress. However, challenges such as U.S. tariffs and logistical issues were noted. Overall, the positive aspects significantly outweighed the negatives.

Q1-2025 Updates

Positive Updates

Record-Breaking Upstream Production

Upstream production reached 853,000 barrels a day, marking the highest first quarter ever and the second highest quarter in company history, surpassing last year's record by 18,000 barrels.

Exceptional Refining Throughput and Utilization

Refining throughput hit 483,000 barrels a day, the highest first quarter ever, with refining utilization at an exceptional 104%, marking the third consecutive quarter above 100%.

Operational Safety Achievements

Suncor continued to maintain its safety performance with recordable and lost time events down significantly, and the base plant team won the John T. Ryan National Safety Award for outstanding safety performance.

Significant Cost Reduction

Total operating, selling, and general (OS&G) expenses stood at $3.3 billion, down $143 million or 4.2% compared to the previous year, despite increased production and throughput.

Strong Financial Performance

Suncor generated $3 billion of adjusted funds from operations and returned nearly $1.5 billion to shareholders, including $705 million in dividends and $750 million in share buybacks.

Progress on Strategic Objectives

Suncor achieved 75% of its three-year production growth target and 70% reduction in breakeven costs, along with 70% of its free funds flow growth target within the first year.

Negative Updates

Challenges with U.S. Tariffs

The first quarter faced uncertainty due to U.S. tariffs, impacting the business environment, although commodity prices remained relatively stable.

Logistical Challenges at Newfoundland

E&P production faced temporary logistics challenges at the Newfoundland loading terminal, although these issues have been resolved.

Company Guidance

During the first quarter of 2025, Suncor Energy provided robust guidance, focusing on operational achievements and financial resilience. The company reported its highest-ever first-quarter upstream production at 853,000 barrels per day, surpassing the previous year's record by 18,000 barrels. Upgrader utilization was notably strong at 102%, marking the fourth quarter out of the last five with utilization rates at 99% or higher. Refining throughput also set a record for the first quarter at 483,000 barrels per day, with a refining utilization of 104%. The company achieved refined product sales of 605,000 barrels per day, another record for the first quarter. Operating costs (OS&G) were reduced by 4.2% to $3.3 billion despite increased production and throughput, demonstrating significant operating leverage. Financially, Suncor generated $3 billion in adjusted funds from operations, returning $1.5 billion to shareholders through dividends and share buybacks. The guidance emphasized Suncor's strategic focus on sustainable excellence, cost reduction, and shareholder value, with ongoing capital discipline to navigate the uncertain market environment.

Suncor Energy Corporate Events

Stock BuybackDividendsFinancial Disclosures

Suncor Energy Achieves Record First-Quarter Results in 2025

Positive

May 6, 2025

Suncor Energy reported record-breaking first-quarter results for 2025, generating over $3 billion in adjusted funds from operations and $1.9 billion in free funds flow. The company achieved its highest-ever first-quarter upstream production and refining throughput, with exceptional asset utilization rates. Suncor returned $1.5 billion to shareholders through dividends and share repurchases, demonstrating its strong financial performance and commitment to delivering shareholder value despite a volatile business environment.

Spark’s Take on TSE:SU Stock

According to Spark, TipRanks’ AI Analyst, TSE:SU is a Outperform.

Suncor Energy’s overall score reflects its strong financial recovery and robust cash flow management. The company has a favorable valuation and is committed to shareholder returns, as evidenced by the share buyback program. Despite current bearish technical indicators, the stock may offer potential upside given its strategic achievements and solid earnings guidance. Investors should consider the risks associated with the challenging business environment and planned maintenance in 2025.

To see Spark’s full report on TSE:SU stock, click here.

Executive/Board ChangesShareholder Meetings

Suncor Energy Announces Results from Annual General Meeting

Neutral

May 6, 2025

Suncor Energy held its Annual General Meeting in Calgary, where shareholders elected eleven board members, appointed KPMG LLP as auditors, and approved the management’s approach to executive compensation. A proposal for a report on the costs of achieving Net Zero by 2050 was denied. The meeting saw approximately 70.29% of outstanding shares represented, indicating strong shareholder engagement.

Spark’s Take on TSE:SU Stock

According to Spark, TipRanks’ AI Analyst, TSE:SU is a Outperform.

To see Spark’s full report on TSE:SU stock, click here.

DividendsBusiness Operations and Strategy

Suncor Energy Declares Quarterly Dividend Amidst Strategic Transition

Positive

May 6, 2025

Suncor Energy has announced a quarterly dividend of $0.57 per share, payable on June 25, 2025, to shareholders of record as of June 4, 2025. This decision reflects Suncor’s ongoing commitment to providing shareholder value while continuing to advance its strategy of transitioning to a lower-emissions future, which may positively impact its market positioning and stakeholder confidence.

Spark’s Take on TSE:SU Stock

According to Spark, TipRanks’ AI Analyst, TSE:SU is a Outperform.

To see Spark’s full report on TSE:SU stock, click here.

Shareholder MeetingsFinancial Disclosures

Suncor Energy to Announce Q1 2025 Results and Host Annual Meeting

Neutral

Apr 22, 2025

Suncor Energy has announced it will release its first quarter 2025 financial results on May 6, 2025, followed by a webcast review on May 7, 2025. The company will also hold its Annual General Meeting online on May 6, 2025. These events are significant for stakeholders as they provide insights into the company’s financial performance and strategic direction.

Spark’s Take on TSE:SU Stock

According to Spark, TipRanks’ AI Analyst, TSE:SU is a Outperform.

To see Spark’s full report on TSE:SU stock, click here.

Stock BuybackBusiness Operations and StrategyRegulatory Filings and Compliance

Suncor Energy Renews Share Buyback Program Amid Annual Disclosure Filing

Positive

Feb 27, 2025

Suncor Energy has filed its 2024 annual disclosure documents and announced the renewal of its Normal Course Issuer Bid (NCIB), allowing the company to repurchase up to 10% of its public float. This move is seen as an attractive investment opportunity and aligns with the company’s strategy to enhance shareholder value without impacting its long-term goals.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.