Suncor Energy vs Canadian Natural Resources Which Is a Smarter Choice?

Suncor Energy and Canadian Natural Resources are two of the largest players in the Canadian oil and gas industry. Both companies are major integrated energy companies with operations spanning across the entire value chain of oil and gas production. Suncor's focus is on oil sands operations, while Canadian Natural Resources has a diversified asset base including conventional oil and gas production. Investors often compare the performance of these two stocks due to their prominence in the industry and their significant impact on the Canadian economy.

Suncor Energy or Canadian Natural Resources?

When comparing Suncor Energy and Canadian Natural Resources, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Suncor Energy and Canadian Natural Resources.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Suncor Energy has a dividend yield of 4.36%, while Canadian Natural Resources has a dividend yield of 5.2%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Suncor Energy reports a 5-year dividend growth of 5.52% year and a payout ratio of 34.85%. On the other hand, Canadian Natural Resources reports a 5-year dividend growth of 13.34% year and a payout ratio of 56.60%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Suncor Energy P/E ratio at 8.37 and Canadian Natural Resources's P/E ratio at 12.57. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Suncor Energy P/B ratio is 1.49 while Canadian Natural Resources's P/B ratio is 2.39.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Suncor Energy has seen a 5-year revenue growth of 0.63%, while Canadian Natural Resources's is 0.79%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Suncor Energy's ROE at 18.10% and Canadian Natural Resources's ROE at 19.14%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $37.15 for Suncor Energy and $31.61 for Canadian Natural Resources. Over the past year, Suncor Energy's prices ranged from $30.89 to $41.95, with a yearly change of 35.80%. Canadian Natural Resources's prices fluctuated between $29.45 and $41.29, with a yearly change of 40.18%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.