Some of these posts are just embarassingThere is an old saying that goes something like this:
"It's better to keep you mouth shut and have people think you are a fool than to open your mouth and prove it"
I was a Bay St financial analyst in a previous life, so that helps a bit when I read presentations created for investors, but it is not like this stuff is rocket science.
SU provided an Investor Day map of the future on Wednesday May 26th which you can see here:
https://www.suncor.com/en-ca/investor-centre/investor-day-2021 ...... click on the Download Investor Day Materials Link
Please spend some time on the presentation. It will help you understand where SU is headed and will hopefully stop you from posting stuff that makes you look bad.
One of the many things you will learn is that their renewable investments are going to generate a 15% return, so it is not about spending money in order to be seen as becoming green friendly.
SU is going to pay investors back about 3/4 of the current share price in the next 4 1/2 years in terms of dividend, debt reduction, and share buybacks, which are all equal in terms of evaluating the company. In addition, SU will invest a couple of extra billion dollars per year on becoming more efficient (where they use a 20% return threshold) or on renewables. The numbers are based upon the expectation of US$55 WTI, which is looking very conservative these days. If WTI stays at $65, SU could afford to add about $2 to the annual dividend and still do everything else it wants to do as per their guidance.
SU's mgmt is fully aware what the trend in demand will be in the future. The company has chosen to focus on lowering costs and improving margins instead of spending money on big projects that they may never need to tap into. As it is, the company has about 60 years of reserves. If the eco landscape changes in the future, they will be in the best shape of anybody to access additional reserves.
Mgmt has chosen to focus on lowering costs and paying down debt this year.
They plan on increasing the dividend by 140% in the next four years based upon their guidance of 25% CAGR. That rate could be much higher if WTI averages more than US$55.
As a comparison, ENB has guided about 6% annual growth which based means 25% over the next 4 years.
SU shares are under significant distribution pressure as instititional investors are being forced to rid their portfolios of tar sand investments.
As of the end of Q1, the 13F reports indicate that instituions owned over 60% of all SU shares. In the past year, instituitional ownership of ENB has dropped by 9% from 58% to 49%.
I suspect that institutions bailed from ENB before SU because ENB has been faced with the additional controversies over Lines 3 and 5. Now it is SU's turn to take it on the chin.
SU's share price is down. Mgmt is taking advantage of the situation with their NCIB's which means they have zero incentive to raise the dividend.
If you are unhappy with the current dividend yield, move on as you will have time to get back in later. If you invest in companies, you have to love what SU is doing and where it is headed.
If you are unsure of where SU is headed, spend time on the link above as it lays out the next four years on a platter.