Quick Report on Suncor Energy (SU)

It's been a great afternoon session for Suncor Energy investors, who saw their shares rise 1.5% to a price of $37.75 per share. At these higher prices, is the company still fairly valued? If you are thinking about investing, make sure to check the company's fundamentals before making a decision.

Suncor Energy Has Attractive P/B and P/E Ratios:

Suncor Energy Inc. operates as an integrated energy company in Canada, the United States, and internationally. The company belongs to the Energy sector, which has an average price to earnings (P/E) ratio of 8.53 and an average price to book (P/B) ratio of 1.78. In contrast, Suncor Energy has a trailing 12 month P/E ratio of 8.2 and a P/B ratio of 1.13.

When we divide Suncor Energy's P/E ratio by its expected EPS growth rate of the next five years, we obtain its PEG ratio of -2.39. Since it's negative, the company has negative growth expectations, and most investors will probably avoid the stock unless it has an exceptionally low P/E and P/B ratio.

Generally Positive Cash Flows but an Average Current Ratio:

2017 2018 2019 2020 2021 2022
Revenue (M) $32,176 $38,986 $38,989 $25,052 $39,101 $58,467
Net Margins 14% 8% 7% -17% 11% 16%
Net Income (M) $4,458 $3,293 $2,899 -$4,319 $4,119 $9,077
Net Interest Expense (M) $216 $741 $875 $930 $851 $814
Depreciation & Amort. (M) $5,601 $5,738 $10,572 $9,526 $5,850 $8,786
Earnings Per Share $2.68 $2.02 $1.86 -$2.83 $2.77 $6.53
Avg. Price $26.53 $30.11 $26.58 $16.14 $19.89 $31.21
P/E Ratio 9.9 14.83 14.29 -5.7 7.18 4.77
Free Cash Flow (M) $8,966 $10,580 $10,421 $2,675 $11,764 $15,680
Total Debt (M) $13,372 $13,890 $12,884 $13,812 $13,989 $9,800
Current Ratio 1.0 0.84 0.94 0.89 1.06 1.13
The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.