Dividend investing primarily requires persistence, and typically, that persistence will get examined. That’s precisely what’s taking place with Canadian Pure Sources (TSX:CNQ) proper now. Regardless of its constant dividend progress and secure enterprise mannequin, the inventory has slipped over 17% from its 52-week excessive. It’s not a straightforward capsule to swallow, however we should not neglect that its long-term fundamentals nonetheless look strong.
In truth, the corporate is producing file volumes, sustaining top-tier operational effectivity, and returning billions to shareholders. Whereas the market may briefly be reacting to short-term pressures, I see this correction as a long-term reward.
On this article, I’ll share why Canadian Pure Sources has grow to be my prime worth choose proper now and what makes it too engaging to disregard.
My prime worth choose for revenue buyers
Being one in every of Canada’s largest power corporations, Canadian Pure Sources operates in oil sands, pure fuel, and offshore tasks. Primarily based in Calgary, it’s identified for long-life, low-decline belongings that assist it generate constant money flows. CNQ inventory is at the moment buying and selling at $43.14 per share with a market cap of $90.2 billion. On the brighter aspect, the latest decline in its inventory has made its annualized dividend yield look extra engaging, which at the moment stands at 5.5%.
Now, regardless of CNQ inventory being down over 17% from its 52-week excessive, the corporate hasn’t proven any indicators of weak point. In truth, Canadian Pure Sources reported record-breaking manufacturing within the first quarter of 2025, with its complete output reaching 1.6 million barrels of oil equal per day. That included file quarterly artificial crude oil manufacturing of 595,000 barrels per day with the assistance of excessive utilization at its oil sands operations and strategic upgrades accomplished final yr.
Financials stay sturdy
The corporate’s first-quarter financials have been simply as spectacular as its operational outcomes. Throughout the quarter, its adjusted earnings got here in at $2.4 billion or $1.16 per share. It additionally reported adjusted funds circulation of $4.5 billion, exhibiting its potential to constantly generate sturdy money circulation, even in a barely weaker pricing atmosphere.
Increased manufacturing volumes, higher value management, and powerful realized costs have been a number of the key components that helped Canadian Pure Sources publish sturdy financials final quarter. Its artificial crude bought for over $95 per barrel throughout the quarter, which considerably lifted its margins. In the meantime, decrease power prices and excessive utilization drove down its working prices throughout segments, together with a 12% year-over-year drop in its oil sands mining prices and a 20% drop in thermal in-situ operations.
These components make it much more engaging
Lately, Canadian Pure Sources has been stepping up manufacturing whereas discovering higher, extra environment friendly methods to function. The corporate just lately diminished its 2025 capital price range by $100 million with out reducing into its manufacturing plans. It’s additionally seeing constructive outcomes from its Duvernay acquisition, the place it expects better-than-planned manufacturing and price financial savings this yr.
As well as, its oil sands mining operations are among the many most cost-effective within the business, with long-life belongings making up nearly all of manufacturing. Briefly, Canadian Pure Sources has the size, money circulation, and operational self-discipline to journey by market cycles — whereas paying buyers a rising stream of dividends. These dividends have been elevated for 25 consecutive years. These components make it my prime worth choose proper now.
