Better Energy Stock: Canadian Natural Resources vs. Suncor

There’s plenty of reason for investors to debate which company may be the best bet in a given sector. For investors looking at the Canadian energy sector, the good news is there’s plenty of world-class options with viable long-term growth prospects to consider. Additionally, many of the top stocks in this sector tend to also be excellent dividend stocks worth buying on this basis alone.

I’m going to dive into two of the top blue-chip Canadian energy stocks and compare them to see which may be the better long-term pick for most investors.

Let’s dive in!

Canadian Natural Resources

Canadian Natural Resources (TSX:CNQ) is quickly becoming one of my top picks in the Canadian energy sector.

Shares of the oil sands company have been moving up and to the right for the better part of the past year, with a nice uptick seen over the course of the past month. This has come on the back of strong earnings, with Canadian Natural bringing in EPS of $0.86 this past quarter, beating expectations by nearly 10%.

With strong earnings driven by solid operating efficiency and one of the best balance sheets among its peer group, there’s a lot to like about CNQ stock as a top-tier play in the energy sector right now.

For those looking for a company with one of the best breakeven prices per barrel in the sector, with improving operating economics and production gains (production increased 14% year-over-year), this is a top company that could deliver similar double-digit gains for the foreseeable future, at least in my books.

Suncor

Suncor (TSX:SU) has been one of my top Canadian energy picks for years, as most readers are likely well aware of.

That said, I think there could be even more reasons why Suncor is worth buying today than there were a few years ago, when I rightly argued that shares of this Western Canadian oil sands player were undervalued. They were.

I believe shares of SU stock remain undervalued, partly due to the company’s strong underlying fundamentals. This past quarter, Suncor reported stunning EPS of $1.05, beating consensus estimates by more than 25% on revenue of nearly $9 billion (which also easily surpassed where the Street had pegged this company’s earnings heading into the print).

As long as Suncor can maintain its high-margin production in this relatively stable commodity price environment, I believe a strong fundamental bull case can be made that this 3.8% yielding energy giant should likely trade even higher than it is currently.

The post Better Energy Stock: Canadian Natural Resources vs. Suncor appeared first on The Motley Fool Canada.

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More reading

• Better Energy Stock: Canadian Natural Resources vs. Suncor
• Set Your Portfolio for Success: Canadian Stock Picks for 2026
• 3 High-Yield Dividend Stocks That Are Compelling Buys Right Now
• Where Will CNQ Stock Be in 3 Years?
• 3 TSX Stocks to Buy Today and Hold for Decades

Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool recommends Canadian Natural Resources. The Motley Fool has a disclosure policy.