Suncor Energy (TSE:SU) has received a price target increase from the Royal Bank of Canada, which adjusted its forecast from C$67.00 to C$70.00. This change was made public in a report released on Friday, December 24, 2023. The bank maintains an “outperform” rating for the stock, indicating confidence in Suncor’s potential for growth.
This revision is part of a broader trend among analysts who have been reassessing Suncor’s stock performance. On January 7, 2023, Raymond James Financial raised their price target from C$70.00 to C$75.00, also assigning an “outperform” rating. Similarly, CIBC increased its price target from C$65.00 to C$70.00 on November 27, 2023. Other notable adjustments include Gerdes Energy Research, which set a target of C$78.00, and National Bankshares, which slightly reduced their target from C$73.00 to C$72.00 while maintaining an “outperform” rating.
Analysts have generally responded positively to Suncor’s performance. According to data from MarketBeat.com, the stock has garnered a consensus rating of “Moderate Buy,” with a target price averaging C$67.62. Currently, one analyst rates Suncor with a “Strong Buy,” five have issued “Buy” ratings, and four have given it a “Hold” rating.
Strong Quarterly Earnings and Dividend Increase
Suncor Energy recently reported its quarterly earnings on November 4, 2023, revealing earnings per share (EPS) of C$1.48. The company’s return on equity stood at 18.10%, with a net margin of 15.15%. Revenue for the quarter reached C$12.55 billion. Analysts project that Suncor will achieve an EPS of approximately 4.42 for the current fiscal year.
In addition to its financial performance, Suncor announced a quarterly dividend payment of $0.60 per share, which was distributed on December 24, 2023. This marks an increase from the previous dividend of $0.57. The annualized dividend now totals $2.40, yielding a dividend rate of 3.7%. The company’s payout ratio is currently at 53.15%.
Insider Trading Activity
Recent insider trading activity has raised eyebrows. On November 17, 2023, insider Peter Douglas Zebedee sold 43,364 shares at an average price of C$62.53, netting a total of approximately C$2.71 million. Additionally, insider Kristopher Peter Smith sold 112,600 shares on November 11, 2023, for a total value of nearly C$6.95 million. Following these transactions, Smith retained 48,482 shares, valued at around C$2.99 million, reflecting a significant decrease in his ownership.
In total, insiders have sold 164,675 shares over the past three months, amounting to C$10.21 million. Currently, corporate insiders hold only 0.01% of the stock.
Suncor Energy is recognized as an integrated energy company, engaging in oil sands development, production, and upgrading, alongside offshore oil and gas operations. The company also operates petroleum refining in Canada and the U.S. and runs the PetroCanada retail and wholesale distribution networks. Suncor is committed to advancing its petroleum resources while investing in renewable fuels, hydrogen, and other low-emission technologies.
As Suncor Energy continues to adapt to changing market conditions, its recent adjustments and performance indicators highlight a cautiously optimistic outlook from analysts and investors alike.
