Best Dividend Stocks. Analyze the stocks with the best dividend, while also showing decent profitability and health.


SUNCOR ENERGY INC

Toronto Stock Exchange / Energy / Oil, Gas & Consumable Fuels

Fundamental Rating

6

SU gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 222 industry peers in the Oil, Gas & Consumable Fuels industry. SU has an excellent profitability rating, but there are some minor concerns on its financial health. SU is valued correctly, but it does not seem to be growing. Finally SU also has an excellent dividend rating. With these ratings, SU could be worth investigating further for dividend investing!.



7

1. Profitability

1.1 Basic Checks

SU had positive earnings in the past year.
SU had a positive operating cash flow in the past year.
Of the past 5 years SU 4 years were profitable.
Each year in the past 5 years SU had a positive operating cash flow.

1.2 Ratios

With an excellent Return On Assets value of 9.37%, SU belongs to the best of the industry, outperforming 88.26% of the companies in the same industry.
Looking at the Return On Equity, with a value of 19.17%, SU belongs to the top of the industry, outperforming 89.67% of the companies in the same industry.
SU's Return On Invested Capital of 8.30% is amongst the best of the industry. SU outperforms 81.69% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for SU is in line with the industry average of 8.08%.
Industry RankSector Rank
ROA 9.37%
ROE 19.17%
ROIC 8.3%
ROA(3y)8.34%
ROA(5y)4.63%
ROE(3y)17.82%
ROE(5y)9.66%
ROIC(3y)9.58%
ROIC(5y)N/A

1.3 Margins

Looking at the Profit Margin, with a value of 16.90%, SU is in the better half of the industry, outperforming 71.36% of the companies in the same industry.
SU's Profit Margin has improved in the last couple of years.
SU has a Operating Margin of 17.68%. This is comparable to the rest of the industry: SU outperforms 58.22% of its industry peers.
In the last couple of years the Operating Margin of SU has remained more or less at the same level.
The Gross Margin of SU (62.90%) is better than 74.65% of its industry peers.
In the last couple of years the Gross Margin of SU has remained more or less at the same level.
Industry RankSector Rank
OM 17.68%
PM (TTM) 16.9%
GM 62.9%
OM growth 3YN/A
OM growth 5Y1.29%
PM growth 3YN/A
PM growth 5Y14.61%
GM growth 3Y-0.08%
GM growth 5Y-0.14%

More info and screens

6

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so SU is still creating some value.
Compared to 1 year ago, SU has less shares outstanding
The number of shares outstanding for SU has been reduced compared to 5 years ago.
The debt/assets ratio for SU has been reduced compared to a year ago.

2.2 Solvency

SU has an Altman-Z score of 2.14. This is not the best score and indicates that SU is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.14, SU is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
The Debt to FCF ratio of SU is 2.40, which is a good value as it means it would take SU, 2.40 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of SU (2.40) is better than 84.04% of its industry peers.
SU has a Debt/Equity ratio of 0.35. This is a healthy value indicating a solid balance between debt and equity.
SU has a Debt to Equity ratio of 0.35. This is comparable to the rest of the industry: SU outperforms 42.72% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.35
Debt/FCF 2.4
Altman-Z 2.14
ROIC/WACC1.13
WACC7.38%

2.3 Liquidity

SU has a Current Ratio of 1.44. This is a normal value and indicates that SU is financially healthy and should not expect problems in meeting its short term obligations.
With a decent Current ratio value of 1.44, SU is doing good in the industry, outperforming 66.67% of the companies in the same industry.
A Quick Ratio of 0.88 indicates that SU may have some problems paying its short term obligations.
SU has a Quick ratio (0.88) which is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 1.44
Quick Ratio 0.88

More info and screens

2

3. Growth

3.1 Past

SU shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -38.70%.
SU shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.99% yearly.
Looking at the last year, SU shows a very negative growth in Revenue. The Revenue has decreased by -15.85% in the last year.
The Revenue has been growing slightly by 4.96% on average over the past years.
EPS 1Y (TTM)-38.7%
EPS 3YN/A
EPS 5Y13.99%
EPS growth Q2Q-30.39%
Revenue 1Y (TTM)-15.85%
Revenue growth 3Y25.79%
Revenue growth 5Y4.96%
Revenue growth Q2Q-7.97%

3.2 Future

The Earnings Per Share is expected to grow by 9.52% on average over the next years. This is quite good.
The Revenue is expected to decrease by -2.58% on average over the next years.
EPS Next Y0.56%
EPS Next 2Y2.94%
EPS Next 3Y3.65%
EPS Next 5Y9.52%
Revenue Next Year3.18%
Revenue Next 2Y-0.3%
Revenue Next 3Y-2.58%
Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

More info and screens

6

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 10.25, the valuation of SU can be described as very reasonable.
Based on the Price/Earnings ratio, SU is valued a bit cheaper than the industry average as 62.44% of the companies are valued more expensively.
When comparing the Price/Earnings ratio of SU to the average of the S&P500 Index (28.28), we can say SU is valued rather cheaply.
A Price/Forward Earnings ratio of 10.19 indicates a reasonable valuation of SU.
SU's Price/Forward Earnings ratio is in line with the industry average.
SU's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 20.88.
Industry RankSector Rank
PE 10.25
Fwd PE 10.19

4.2 Price Multiples

75.59% of the companies in the same industry are more expensive than SU, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, SU is valued a bit cheaper than the industry average as 73.24% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 10.5
EV/EBITDA 5.3

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates SU does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of SU may justify a higher PE ratio.
PEG (NY)18.14
PEG (5Y)0.73
EPS Next 2Y2.94%
EPS Next 3Y3.65%

More info and screens

8

5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 4.05%, SU is a good candidate for dividend investing.
SU's Dividend Yield is a higher than the industry average which is at 8.84.
SU's Dividend Yield is rather good when compared to the S&P500 average which is at 2.41.
Industry RankSector Rank
Dividend Yield 4.05%

5.2 History

On average, the dividend of SU grows each year by 7.66%, which is quite nice.
SU has paid a dividend for at least 10 years, which is a reliable track record.
SU has decreased its dividend in the last 3 years.
Dividend Growth(5Y)7.66%
Div Incr Years2
Div Non Decr Years2

5.3 Sustainability

33.14% of the earnings are spent on dividend by SU. This is a low number and sustainable payout ratio.
SU's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP33.14%
EPS Next 2Y2.94%
EPS Next 3Y3.65%

More info and screens