Following Thursday’s release of its 2025 guidance that largely fell in line with expectations, Desjardins Securities analyst Chris MacCulloch sees Canadian Natural Resources Ltd. (
) continuing to deliver “an attractive organic growth profile and compelling economic returns, which supports the premium valuation.”
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“We have frequently highlighted CNQ as the premier operator within the WCSB, a sentiment that we feel compelled to echo on the heels of its 2025 capital budget and guidance release, even with renewed competition for investor mindshare in the Canadian large-cap space,” he said in a note titled .
“To be clear, there were limited surprises from the update, with investors poised to continue benefiting from an attractive organic growth profile, supplemented by opportunistic M&A and underpinned by industry-leading inventory depth. For context, the company plans to deliver 3–4-per-cent annualized production growth after accounting for recently acquired volumes from the Chevron Canada transaction, a pace consistent with longer-term historical trends, with a continued focus on bitumen and conventional heavy oil prospects offering superior economics.”
Mr. MacCulloch noted the updated lacked details on the strategic direction for the Calgary-based company’s “extensive” natural gas prospects “to the extent that associated volumes are expected to drive the lion’s share of gas-weighted growth.”
“Obviously, this reflects the superior economics of liquids-rich assets in the current environment, although we still believe the company retains opportunities to shift capital toward attractive short-cycle dry gas prospects as commodity prices dictate,” he said. “Either way, we trust the company to continue deploying capital in a prudent manner. Tack on.”
After trimming his 2024 and 2025 production expectations while raising his cash flow forecast, Mr. MacCulloch reiterated a “buy” rating and 12-month target of $57.50 for Canadian Natural shares. The average is $56.08.
Canadian Natural Resources Ltd.
51.51+8.34 (19.32%)
Past year
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