Suncor Energy (TSX:SU)(NYSE:SU) has proven to be a real winner in the race for top Canadian value stocks. Indeed, Suncor stock is up around 45% over the last year, owing to excellent performance throughout 2021.
Furthermore, this most recent achievement appears to be a sign of future success.
Crude oil costs rose 70% in 2021. Perhaps oil price hikes will level off or return to a long-term average in the near future. Suncor, on the other hand, has done exceptionally well relative to the TSX over the past year.
Here's why we think Suncor stock could have another great year in 2022.
Suncor stock will benefit from its its dividend doubling
Suncor's top- and bottom-line performance this year has been fantastic, fueled by rising energy costs. This success has prompted investors to expect greater cash flow outperformance and more dividends.
Suncor has listened.
The firm has announced plans to double its dividend payout in recent days. This big move also coincides with accelerated share repurchases. Overall, Suncor's shareholder-friendly approach appears to be paying off. As the company's major energy exploration, refinement, and market operations as well as oil sands businesses surpass expectations, investors benefit. As a result, those who are looking for long-term value in an energy stock to invest in have cause to be pleased with Suncor's performance right now.
Greater production and capital expenditures expected for 2022
With energy costs remaining high, firms like Suncor are in a fantastic position. Capital expenditure growth and share repurchases haven't happened in a long time. What an effect $80 oil can make.
Suncor's 2022 guidance is that it should be able to fulfill its previous obligations, and then some. This goal reflects continued cost and capital discipline, as well as excellent operational performance in every area. Suncor's expectations for its core business are positive, and Suncor intends on increasing shareholder value.
There's a lot to appreciate about how Suncor is positioned right now.
Suncor's recent performance is noteworthy, and those who believe in the long-term importance of the energy business should profit. Suncor is a significant player in Canada's energy sector, to be sure. As energy prices remain high in the mind of investors, there are several reasons to buy this stock.
In this scenario, the firm's good results thus far in 2021 are likely to continue into 2022. In this market, those seeking for value will note that Suncor stock is currently priced at about 21 times earnings. After investors have digested these near-term catalysts, Suncor stock trades at a valuation of about 21 times earnings.