Is This the Top Dividend Stock of the 21st Century?

Core Viewpoint - Canadian Natural Resources has demonstrated exceptional dividend growth, raising its dividend by an average of 21% annually over 24 years, resulting in a total increase of 9,300% since 2001, which reflects strong operational performance and strategic management [2][4]. Group 1: Dividend Growth and Financial Performance - The company has achieved an average annual dividend increase of 21%, similar to the long-term performance of Berkshire Hathaway, leading to substantial returns for investors [1][2]. - An investment of $100 in mid-2001 would yield $2,557 in annual dividends today, showcasing the compounding effect of consistent dividend increases [2]. - Canadian Natural Resources' stock price has appreciated by 4,232% since mid-2001, indicating strong capital growth alongside dividend increases [3]. Group 2: Factors Supporting Continued Dividend Growth - The company has improved productivity through vertical integration, allowing it to optimize operations across the supply chain, which is expected to enhance earnings [5]. - The adoption of artificial intelligence (AI) has significantly reduced exploration risks and costs, with record quarterly production of 1.62 million barrels of oil equivalent (BOE), a 19% year-over-year increase [7][10]. - Operating costs have decreased, with natural gas operations costs falling by 7% and heavy crude oil costs by 12%, leading to an industry-leading operating cost of around $21 per barrel [10][11]. Group 3: Share Buyback Program - The company has initiated a Normal Course Issuer Bid, allowing it to repurchase up to 10% of its float, approximately 178.7 million shares, which can enhance earnings per share and support dividend sustainability [12][13]. - In Q3, the company repurchased about 7.2 million shares for $300 million, indicating a commitment to returning value to shareholders [14]. Group 4: Financial Resilience and Strategic Opportunities - Canadian Natural Resources reported over $4.3 billion in liquidity, providing a buffer for dividends, buybacks, and potential acquisitions, positioning the company to capitalize on market opportunities [19][21]. - The company’s ability to maintain profitability with an operating cost of around $21 per barrel will help it navigate potential downturns in oil prices, making it an attractive option for long-term investors [22].