RE:SU will create more long term wealth than comparable Co'sThey were pulling a 40-50% margin on fuel and getting a a high price for oil for a few months...oil is now back to pre Nazi conflict prices and the fact that SU has the world's largest toxic liability will not bring back the foreign or esg conscious money. Pension funds and govt own most of it anyway....they need the money.
Clemxb7 wrote: Growth is being achieved at Suncor. They just quadrupled last year's quarter's earnings.
Growth will be attained through stock buybacks. If Suncor can achieve its target of 10% stock buybacks this year that’s 11% growth which actually reverse compounds so 11% becomes 14% becomes 16% type thing as share count dwindles over time. Once SU is putting 75% this is stock buybacks should be goosed even higher. With the divestiture of assets Suncor will hit it's $12 billion debt target quite soon. This is a event to watch for. As soon as the sale of Petrocan is known $9 billion debt will be a done deal and 100% buybacks should immediately commence.
Obviously Suncor has taken the buyback route which believe it or not is the best long term strategy. When you buy back shares it improves the lot of all remaining shareholders permanently. Once a dividend goers out the door it's gone for good.
If you want yield right now go for CNQ or somebody else. Right now you can get 4.5% div from Suncor - that’s not bad to be paid to wait while more and more wealth is created by the company. The thing about Suncor is given some time the rewards will be richer. It may be a strategy to jump into CNQ for the dividend and then jump back to Suncor for the long term wealth creation. Personally I am not going to do that because when I try those kind of brilliant moves they have a tendency to go wrong. I will stick to Suncor for the longer term ( at least 18 months) because it’s the calculated bet most likely to pay off big to my mind. The fact that Suncor is such aa rich company trading at such a low PE while there is a favourable macro environment for oil gives me the confidence to hold. Meanwhile watching the oil markets has become quite a hobby that I find quite fascinating so there is that to help amuse me in the meantime. (lol)