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Suncor (TSX:SU) Stock: Is There 180% Upside? – The Motley Fool Canada

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Suncor (TSX:SU)(NYSE:SU) stock is controversial. Some investors think shares are going to $0. Others think there’s huge upside.

This year, shares are 63% lower. The obvious cause is the coronavirus pandemic, which sent oil demand sharply lower. If the stock regains its former levels, there would be 180% in potential upside.

Of course, for Suncor stock to recover, global oil demand would need to normalize. What would need to happen for that future to become reality?

This is the challenge

The biggest challenge is oil prices. As a fossil fuel producer, Suncor will live or die by this single metric. If oil prices move lower long term, profits will fall or even disappear. Only higher commodity pricing will save the stock.

Fortunately, this stock is considered an integrated oil company. That means it owns the entire value chain, from initial production all the way to the end user. Especially in this market, that’s a unique advantage.

For example, when oil prices fall, refinery margins often rise. Because it owns its own refineries, Suncor can mitigate the pain of lower pricing.

Additionally, the company owns its own pipeline network. That means it doesn’t cede profitability to a third party in order to ship its product. That’s an important advantage when profits are difficult to come by.

Given its size and integrated strategy, Suncor should outlast most of its competitors. Pure-play businesses that simply pump and sell oil won’t have the resources or diversification to survive as long.

Survival is one thing. Success is another. For the stock to surge, either demand needs to rebound or supply needs to tighten.

Will Suncor stock surge?

A stock surge will completely depend on oil markets tightening. There’s simply way too much supply versus demand right now. Let’s look at the possibilities.

On the supply side, no relief is expected. Producers keep pumping, and breakeven prices continue to fall.

“Technology continues to improve, and there are still plenty of low-cost reserves to tap, at least over the next few years,” I wrote recently. “And now, more than ever, producers are focusing their efforts on these low-cost plays.”

The demand side is similarly difficult. New waves of COVID-19 threaten additional shutdowns. Travel restrictions are keeping a lid on vehicle and plane transportation. Even worse, global oil demand may have already peaked.

BP just released a report that shocked analysts. The research found that demand will never reach 2019 levels again! That’s a decade earlier than predicted. This is just one report, but if it’s true, oil prices will face permanent pressures. That’s no good for Suncor.

No one can predict stock prices weeks or months in advance. Only long-term predictions hold much weight. When it comes to a multi-year view, the picture is uncomfortably bleak for oil.

“To be sure, Suncor will still survive, as fossil fuel demand will continue for decades to come,” I recently concluded. “But if demand is on a permanent downtrend, and supply issues persist unabated, there’s simply not much hope for fossil fuel stocks.”

Fossil fuel stocks are dying, but our new Buy List is ready to surge.

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Fool contributor Ryan Vanzo has no position in any stocks mentioned.

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Stop Asking Your Interviewer Cliché Questions

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Most job search advice is cookie-cutter. The advice you’re following is almost certainly the same advice other job seekers follow, making you just another candidate following the same script.

In today’s hyper-competitive job market, standing out is critical, a challenge most job seekers struggle with. Instead of relying on generic questions recommended by self-proclaimed career coaches, which often lead to a forgettable interview, ask unique, thought-provoking questions that’ll spark engaging conversations and leave a lasting impression.

English philosopher Francis Bacon once said, “A prudent question is one half of wisdom.”

The questions you ask convey the following:

  • Your level of interest in the company and the role.
  • Contributing to your employer’s success is essential.
  • You desire a cultural fit.

Here are the top four questions experts recommend candidates ask; hence, they’ve become cliché questions you should avoid asking:

  • “What are the key responsibilities of this position?”

Most likely, the job description answers this question. Therefore, asking this question indicates you didn’t read the job description. If you require clarification, ask, “How many outbound calls will I be required to make daily?” “What will be my monthly revenue target?”

  • “What does a typical day look like?”

Although it’s important to understand day-to-day expectations, this question tends to elicit vague responses and rarely leads to a deeper conversation. Don’t focus on what your day will look like; instead, focus on being clear on the results you need to deliver. Nobody I know has ever been fired for not following a “typical day.” However, I know several people who were fired for failing to meet expectations. Before accepting a job offer, ensure you’re capable of meeting the employer’s expectations.

  • “How would you describe the company culture?”

Asking this question screams, “I read somewhere to ask this question.” There are much better ways to research a company’s culture, such as speaking to current and former employees, reading online reviews and news articles. Furthermore, since your interviewer works for the company, they’re presumably comfortable with the culture. Do you expect your interviewer to give you the brutal truth? “Be careful of Craig; get on his bad side, and he’ll make your life miserable.” “Bob is close to retirement. I give him lots of slack, which the rest of the team needs to pick up.”

Truism: No matter how much due diligence you do, only when you start working for the employer will you experience and, therefore, know their culture firsthand.

  • “What opportunities are there for professional development?”

When asked this question, I immediately think the candidate cares more about gaining than contributing, a showstopper. Managing your career is your responsibility, not your employer’s.

Cliché questions don’t impress hiring managers, nor will they differentiate you from your competition. To transform your interaction with your interviewer from a Q&A session into a dynamic discussion, ask unique, insightful questions.

Here are my four go-to questions—I have many moreto accomplish this:

  • “Describe your management style. How will you manage me?”

This question gives your interviewer the opportunity to talk about themselves, which we all love doing. As well, being in sync with my boss is extremely important to me. The management style of who’ll be my boss is a determining factor in whether or not I’ll accept the job.

  • “What is the one thing I should never do that’ll piss you off and possibly damage our working relationship beyond repair?”

This question also allows me to determine whether I and my to-be boss would be in sync. Sometimes I ask, “What are your pet peeves?”

  • “When I join the team, what would be the most important contribution you’d want to see from me in the first six months?”

Setting myself up for failure is the last thing I want. As I mentioned, focus on the results you need to produce and timelines. How realistic are the expectations? It’s never about the question; it’s about what you want to know. It’s important to know whether you’ll be able to meet or even exceed your new boss’s expectations.

  • “If I wanted to sell you on an idea or suggestion, what do you need to know?”

Years ago, a candidate asked me this question. I was impressed he wasn’t looking just to put in time; he was looking for how he could be a contributing employee. Every time I ask this question, it leads to an in-depth discussion.

Other questions I’ve asked:

 

  • “What keeps you up at night?”
  • “If you were to leave this company, who would follow?”
  • “How do you handle an employee making a mistake?”
  • “If you were to give a Ted Talk, what topic would you talk about?”
  • “What are three highly valued skills at [company] that I should master to advance?”
  • “What are the informal expectations of the role?”
  • “What is one misconception people have about you [or the company]?”

 

Your questions reveal a great deal about your motivations, drive to make a meaningful impact on the business, and a chance to morph the questioning into a conversation. Cliché questions don’t lead to meaningful discussions, whereas unique, thought-provoking questions do and, in turn, make you memorable.

_____________________________________________________________________

 

Nick Kossovan, a well-seasoned veteran of the corporate landscape, offers “unsweetened” job search advice. You can send Nick your questions to artoffindingwork@gmail.com.

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Canadian Natural Resources reports $2.27-billion third-quarter profit

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CALGARY – Canadian Natural Resources Ltd. reported a third-quarter profit of $2.27 billion, down from $2.34 billion in the same quarter last year.

The company says the profit amounted to $1.06 per diluted share for the quarter that ended Sept. 30 compared with $1.06 per diluted share a year earlier.

Product sales totalled $10.40 billion, down from $11.76 billion in the same quarter last year.

Daily production for the quarter averaged 1,363,086 barrels of oil equivalent per day, down from 1,393,614 a year ago.

On an adjusted basis, Canadian Natural says it earned 97 cents per diluted share for the quarter, down from an adjusted profit of $1.30 per diluted share in the same quarter last year.

The average analyst estimate had been for a profit of 90 cents per share, according to LSEG Data & Analytics.

This report by The Canadian Press was first published Oct. 31, 2024.

Companies in this story: (TSX:CNQ)

The Canadian Press. All rights reserved.

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Cenovus Energy reports $820M Q3 profit, down from $1.86B a year ago

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CALGARY – Cenovus Energy Inc. reported its third-quarter profit fell compared with a year as its revenue edged lower.

The company says it earned $820 million or 42 cents per diluted share for the quarter ended Sept. 30, down from $1.86 billion or 97 cents per diluted share a year earlier.

Revenue for the quarter totalled $14.25 billion, down from $14.58 billion in the same quarter last year.

Total upstream production in the quarter amounted to 771,300 barrels of oil equivalent per day, down from 797,000 a year earlier.

Total downstream throughput was 642,900 barrels per day compared with 664,300 in the same quarter last year.

On an adjusted basis, Cenovus says its funds flow amounted to $1.05 per diluted share in its latest quarter, down from adjusted funds flow of $1.81 per diluted share a year earlier.

This report by The Canadian Press was first published Oct. 31, 2024.

Companies in this story: (TSX:CVE)

The Canadian Press. All rights reserved.

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