SU ain't no Peloton; SU has real world revenues and profitsI tend to agree Suncor should already be over $80 at least.
Q2 numbers are going to be mind-blowing. Earnings should be between $3 and $4 with a shot of exceeding $4. How can I say this? I've been crunching the numbers for Suncor for a while and the kinds of revenues they are currently getting are indeed mind blowing compared to the past.
Compare now to June 2018 which is last time Suncor share price was between $50 and $55:
- June 2018: Oil price (WTI) = $65 - $75 barrel Now $120 (+$45-$55)
- June 2018 WCS price = ~$40 Now $102 (+$65)
- June 2018 3-2-1 Crack Spreads ~$15 Now $62 (+$47)
All that extra money goes directly to the bottom line (minus taxes, royalties etc.) That’s why I say profit is gonna balloon.
Why isn't Suncor over $80 yet? It’s a bit of a mystery. The stock market became an "innovation" bubble (Peloton or Beyond Meat anyone?) and now that it is deflating it affects Suncor. Like really who wants to buy a company that is currently sucking on a firehose of real cash when you can buy a company with tiny revenues though a future full of imagination revenues?
Also some dumb butts think oil is pass however Suncor will still be humming along 30 years from now - believe it and oil will still very much in demand. I hope the world can transition to a low carbon environment though people are going to do what’s best for the pocketbook. It would take worldwide cooperation to accomplish that so how likely is it really? There may simply not be enough nickel and copper to pull off a switch.