Suncor Energy Stock: Not a Buy Yet, But Still Worth Holding On

Core Insights - Suncor Energy Inc. is a leading integrated energy company in Canada, involved in oil and natural gas production, refining, and marketing of petroleum products, playing a significant role in both national and global energy markets [1] Stock Performance - Over the past 12 months, Suncor's stock has increased by 22.2%, outperforming the Oil & Gas-Canadian Integrated sub-industry's growth of 18.3% and the broader Oil-Energy sector's increase of 7.1% [4] - The Zacks Consensus Estimate for Suncor's earnings per share has improved by 15.14% for 2025 and 14.53% for 2026 over the past 60 days, indicating positive market sentiment [5] Factors Driving Performance - Suncor's integrated business model, which spans oil sands extraction to refining and retail sales, provides a competitive advantage by capturing margins at every stage of the value chain [6] - The downstream segment has achieved record throughput, with refinery utilization expected to remain between 99% and 102% through 2026, indicating improved reliability and efficiency [8][13] - The company has reduced net debt to C$7.1 billion, down from C$8.0 billion in Q3 2024, enhancing financial flexibility and reducing risk [9] - Suncor's downstream transformation focuses on increasing higher-margin retail and wholesale sales while reducing lower-margin exports, improving profitability [10] Operational Performance - Suncor has set new operational records, including upstream production of 870,000 bbls/d and refinery throughput of 492,000 bbls/d in Q3 2025, prompting upward revisions in full-year guidance for production and sales [11] - The Fort Hills asset, now fully owned by Suncor, is showing strong performance with production targets aimed at reaching 195,000-200,000 bbls/d in the coming years [14] Shareholder Returns - Suncor has committed to an aggressive share buyback program, increasing monthly repurchases to C$275 million, projecting a total of C$3.3 billion in buybacks for 2026, reinforcing its focus on returning excess cash to shareholders [12][16]