Suncor Energy Inc. T.SU

Some Thoughts on Recent Discussion

[Experienced]

First of all great discussion with the exception of some who would rather diss others than contribute.

I have talked many times about being a pragmatic investor

. Sooo....What does that mean?

Well a lot of things but most importantly it means not being emotionally involved in the ownership of a particular company and listening to all points of view to make the best investment decisions.

So let's look at the current discussion regarding SU and TSLA.....Right now I don't own either.....

SU.....

1.....there are lots of untapped proven reserves world-wide in SA, Russia, the US, Canada, Venezuela , Guyana etc.  So supply destruction is not something that one should plan on.

2.....on the demand side, like it or not, Governments are determined to reduce oil demand growth.  For this to change Government policy has to change in a significant way.  So this is clearly a headwind.

3....From Point 1 and 2, the direction arrow for year over year growth in energy prices faces challenges

4....on the production side, SU faces challenges to increase production every year

Points 4 and 5 are the drivers for further increases in the SP for SU.  So when you look at it, a lot of things have to go right for a growth in the SP of SU going forward.  Yes it has done well recently as the oil price has moved up to the SA social cost of oil and some impact from the war in Ukraine but that is essentially done.

From a market valuation perspective, SU is not priced relative to its valuation metrics and this has been the case for quite a while.  This is a clue that the Pros think Points 4 and 5 are important.

TSLA

In terms of valuation, TSLA isn't valued as a car company.  If it was then it's P/E ratio would be a fraction of what it is now.  Obscure has listed many things outlining the potential for TSLA.  Just like what I said above for SU, a lot of things need to go right so it is not a slam dunk.  Just like SU, the question for me as a pragmatic investor is what is the catalyst for future price increases.  To me given TSLA's current metrics, it is a stretch to see it outperforming the market just as I have the same opinion for SU from its current price.

So what I doing?

Investing elsewhere....

Constructive opinions and discussion welcome....

[Marty47]

I give you a thumbs up ! As you point out both companies get influence by government policies , I do own suncor bought at 20$ and well I like to invest in dividend stock after this great return , I maybe looking at selling but keep my other mid cap oil stocks ,  For Tesla I think it was good at the beginning ,now more competition from china will make the company less profitable , and as

[Experienced]

Marty...good moves!!

[meritmat]

I dont agree theres lots of untapped reserves. US shale is declinging. Canada   The goverment has prety much shut the door on new mega projects Venezuela. Will take decades to bring back there oil plus wont happen with there current goverment Russia.  Same plus they have a country to rebuild once they get done bombing it. The only country sitting on excess supply is SA, think

[meritmat]

Lastly.  The Canadian energy sector is massively undervalued compared to the US companies.   I think there is some great buying opportunities.   The next 5-10 years will usher in a new bull market in energy  And if I'm wrong it won't be the last time 

[Experienced]

merimat.. Guess we disagree on whether there are lots of untapped reserves but setting that aside, your last last statement is key from an investment perspective and is my point in my post - "20-30 years from peak oil" Until we get past the day of peak oil, it is unlikely that (except for short term bottlenecks), the price of oil is unlikely to increase at a rate higher than inflation

[meritmat]

I guess I should have said, this current government.   The moment the Cons are in the base camp expansion gets rubber stamped.  Plus if memory serves they entered into an agreement to look at developing a chunk of land the natives own.   im not to worried about it, I think it will work its way out in the end