An Incredible Canadian Dividend Stock Up 19% to Buy and Hold Forever

A dividend stock starts to look magnificent when it climbs for the right reasons. The share price rises, but the business still generates real cash, keeps debt under control, and covers the dividend without gymnastics. The yield rises as the price increases, so patient investors can lock in more income per dollar invested. The best long-term holds also do something smarter than just paying dividends. They buy back shares, improve operations, and keep investing in projects that make each future dividend feel safer, not shakier. And right now, there’s one making all these moves.

SU

Suncor Energy (TSX:SU) fits the “built to last” profile as it runs an integrated energy business, not a one-trick pony. It produces oil from oil sands and offshore assets, upgrades and refines it, then sells fuel through a huge downstream network under the Petro-Canada banner. That integration matters in real life because strong refining margins can help offset weaker upstream prices, and vice versa.

The dividend stock has also reminded investors that energy never moves in a straight line. Over the past year, shares are up a whopping 19%, so the swings have been wide enough to test anyone’s patience, though mostly in the right direction. Even with the recent rebound, it has spent time well below the year’s high, including stretches around the low-$50s, which works out to roughly a high-teens pullback from that peak.

That volatility does not automatically mean something is “wrong.” With Suncor, a lot of the story has been execution and the broader oil tape. When oil prices soften or differentials widen, the market flinches. When operations run hot, the market remembers why integrated oil sands cash flow can look surprisingly steady. As of early writing, the dividend stock shows share prices reaching back to heights not seen since 2008! That’s quite the recovery from the drops of 2020.

Numbers don’t lie

Now for the part that actually matters if you want to hold it for decades: the cash engine. In the third quarter of 2025, Suncor reported net earnings of $1.6 billion, or $1.34 per share. It reported adjusted operating earnings of $1.8 billion, or $1.48 per share. It also generated adjusted funds from operations of $3.8 billion, or $3.16 per share, which gives you a clear sense of the cash power behind dividends and buybacks.

Operationally, it did not just “get lucky.” Suncor reported total upstream production of 870,000 barrels per day in Q3 2025, and refinery utilization of 106%, alongside record refined product sales of 646,800 barrels per day. It also returned $1.4 billion to shareholders that quarter through dividends and share repurchases. That blend of strong operations and shareholder returns is exactly what you want from a dividend stock you plan to ignore for years at a time.

The 2026 outlook gives the “magnificent hold” idea more bite as it mixes growth with discipline. Suncor expects 2026 upstream production of 840,000 to 870,000 barrels per day, while trimming its capital budget to $5.6 to $5.8 billion from its 2025 range. It also highlighted a plan to increase monthly share buybacks to about $275 million. This could total roughly $3.3 billion in 2026.

Bottom line

So why is Suncor a Canadian dividend stock that can look magnificent when it’s down? Because you’re not buying a fragile story. You’re buying a cash-generating, integrated operator that just posted strong earnings, raised its dividend, and mapped out higher 2026 production with lower planned spending. Right now, here’s what $7,000 could bring in.

COMPANYRECENT PRICENUMBER OF SHARESDIVIDENDANNUAL TOTAL PAYOUTFREQUENCYTOTAL INVESTMENTSU$63.84109$2.40$261.60Quarterly$6,958.56

The risks still matter, as oil prices can drop and operations can surprise the wrong way. But if you want a long-term dividend hold that can pay you, buy back shares, and keep improving through the cycle, Suncor earns a serious look when the market hands you a discount.

The post An Incredible Canadian Dividend Stock Up 19% to Buy and Hold Forever appeared first on The Motley Fool Canada.

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More reading

• Suncor Energy: Buy Now or Wait?
• The January Reset: 2 Beaten-Down TSX Stocks That Could Stage a Comeback
• Suncor Energy: Should You Buy the Dip?
• My 3 Best TSX Value Stock Ideas Going Into 2026
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Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.