Suncor Energy’s shift into “harvest” mode for shareholders makes it a very strong buy for us. By reaching its debt targets early, the firm has unlocked a massive flow of excess capital that’s now being funneled directly back to investors through aggressive buybacks and a recently hiked dividend. This capital discipline has significantly de-risked the stock: it’s no longer just a bet on the price of oil, it’s a bet on a highly efficient, cash-generating machine that’s systematically shrinking its share count.
Furthermore, the firm’s integrated model provides a unique defensive moat. When oil prices are high, the upstream oil sands assets generate massive profits. When prices dip, the downstream refining and Petro-Canada retail segments often benefit from lower feedstock costs and steady consumer demand. This “natural hedge” ensures the firm can maintain its dividend and buyback programs even during periods of market volatility, making it a cornerstone holding for any income-focused Canadian portfolio.
SUNCOR ENERGY INC. (Toronto symbol SU) is Canada’s largest integrated oil firm, with major projects in the Alberta oil sands. It also operates four refineries: three in Canada (Edmonton, Montreal and Sarnia, Ontario) and one in Colorado. They supply fuel to 1,638 Petro-Canada retail gas stations (Suncor owns 765 of those stations), and another 216 stations in the U.S. (it owns 44 of those outlets).
Suncor produced a record 909,100 barrels a day in the fourth quarter of 2025, up 3.9% from 875,000 barrels a year earlier. That increase reflects higher output from its main oil sands projects (93% of total output). On top of that, sales of refined petroleum products rose 4.4% to 640,400 barrels a day from 613,300 barrels.
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However, due to lower crude prices, Suncor’s revenue in the quarter fell 3.9%, to $12.04 billion from $12.53 billion. That missed the consensus forecast of $12.14 billion.
The lower revenue also cut overall cash flow by 7.9%, to $2.68 billion from $2.78 billion. Due to fewer shares outstanding, cash flow per share declined 3.6%, to $2.68 from $2.78. That still topped the consensus estimate of $2.63.
Suncor’s massive share buyback expansion signals long-term confidence
In January 2026, the stock fell slightly in response to the U.S. capture of Venezuelan president Nicolas Maduro and the Trump administration’s plan to increase that country’s oil production.
Higher oil exports from Venezuela could hurt demand for Alberta crude at refineries on the U.S. Gulf Coast. However, those facilities process just 10% of Canada’s crude oil exports. Moreover, it will take years to repair and upgrade Venezuela’s oilfield infrastructure, including pumps and pipelines.
Meantime, Suncor produced a record 860,000 barrels a day in 2025. That’s up 4.0% from 827,000 barrels in 2024.
The company’s refineries also processed a record 480,000 barrels a day in 2025, up 3.2% from 465,000 barrels in 2024.
In 2026, Suncor expects to produce between 840,000 and 870,000 barrels a day. The company also continues to cut its operating costs, which will help shield it from lower crude prices.
Thanks to those lower costs, the company raised your quarterly dividend by 5.3% with the December 2025 payment. Investors now receive $0.60 a share instead of $0.57. The new annual rate of $2.40 yields 3.1%.
What’s more, it plans to increase the dividend rate by 3% to 5% annually. Suncor also plans to buy back $275 million of its shares per month (or $3.3 billion annually).
Including this latest increase, Suncor has now raised its dividend by an average of 23.4% annually in the past five years. Its TSI Dividend Sustainability Rating is Above Average.
Recommendation in The Successful Investor: Suncor Energy Inc. is a buy.
