Suncor (TSX:SU) and Canadian Pure Sources (TSX:CNQ) have chalked up good beneficial properties in current months. Traders who missed the rally are questioning if SU inventory or CNQ inventory remains to be engaging and good to purchase for a self-directed Tax-Free Financial savings Account (TFSA) or Registered Retirement Financial savings Plan (RRSP) portfolio centered on dividends and long-term returns.
Suncor
Suncor trades close to $63 per share on the time of writing, in comparison with $45 in April, and has greater than tripled off the 2020 lows.
Traders punished the inventory throughout the pandemic after Suncor shocked the market with a big dividend reduce within the early weeks of the crash. The board finally reversed the cuts, and Suncor has since raised the distribution above the earlier degree, however it took a while to persuade buyers to return to the inventory.
Administration has finished a great job up to now two years of lowering prices, enhancing effectivity, and delivering stable manufacturing development. Suncor delivered manufacturing of 870,000 barrels per day (bbls/d) within the third quarter (Q3) of 2025 in comparison with 829,000 bbls/d in the identical quarter final 12 months.
The refining enterprise noticed throughput hit a file 492,000 bbls/d. Suncor’s refineries flip crude oil into gasoline, jet gasoline, and different merchandise.
On the retail aspect, Suncor reported file refined product gross sales of 647,000 bbls/d within the quarter.
Suncor lately raised its dividend by 5%. Traders who purchase SU inventory on the present share value can get a dividend yield of three.8%.
Suncor advantages from its built-in enterprise construction. When oil costs fall, the refining and retail divisions are inclined to do effectively. This helps offset the margin hit on the manufacturing property. The enterprise mannequin was what traditionally made Suncor the popular decide within the Canadian vitality patch earlier than it bumped into operational points.
Wanting forward, the slowdown of electrical car adoption may gain advantage the refining and retail divisions. Suncor operates the Petro-Canada model of service stations throughout Canada. On the similar time, enlargement in oil pipeline capability will allow Suncor to extend oil manufacturing and gross sales within the coming years.
Canadian Pure Sources
Canadian Pure Sources has elevated its dividend yearly for the previous 25 years. That is a formidable observe file in a sector that depends on commodity costs to find out margins. CNRL has a diversified asset base that features oil sands, offshore oil, typical heavy and lightweight oil, pure gasoline and pure gasoline liquids manufacturing.
The corporate is the only real or majority proprietor of most of its operations. This will increase danger but in addition offers CNRL the pliability to shortly transfer capital across the portfolio to reap the benefits of constructive strikes in oil or pure gasoline costs. CNRL is greatest recognized for its oil operations, however can also be a significant pure gasoline producer.
Demand for pure gasoline is anticipated to extend within the coming years as gas-fired energy era services are constructed to each exchange coal-fired crops and to supply electrical energy for brand new AI information centres. New liquified pure gasoline (LNG) export services in British Columbia will allow CNRL and different producers to promote their product in higher-priced worldwide markets.
CNRL continues to drive manufacturing development by acquisitions and profitable drilling applications. Adjusted earnings rose by the primary 9 months of 2025 in comparison with final 12 months, regardless of weaker vitality costs.
Traders who purchase CNQ inventory on the present value can get a dividend yield of 4.9%.
Is one a greater decide?
Traders centered purely on passive revenue ought to make CNQ the primary alternative for the upper yield.
That being mentioned, Suncor has made good progress on its turnaround plan and may proceed to draw buyers who beforehand shunned the inventory. The built-in enterprise construction gives a extra balanced income stream than you get on the pure-play producers.
On the present costs, I’d in all probability break up a brand new funding between the 2 shares.
