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Suncor Energy Inc. (SU)

Company Dividend Discount ModelIndustry: Oil & Gas IntegratedSector: Energy

Valuation Snapshot

Stable Growth$117.53 - $412.50$194.33
Multi-Stage$108.51 - $118.83$113.58
Blended Fair Value$153.95
Current Price$58.20
Upside164.52%
DecisionBuy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS1.41%6.52%2.272.232.101.261.352.121.891.721.521.34
YoY Growth--1.96%5.89%67.48%-7.19%-36.11%12.04%9.84%13.16%13.90%10.60%
Dividend Yield--4.08%4.42%5.01%3.08%5.16%9.54%4.30%3.87%3.72%3.69%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)5,260.00
(-) Cash Dividends Paid (M)2,803.00
(=) Cash Retained (M)2,457.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)1,052.00657.50394.50
Cash Retained (M)2,457.002,457.002,457.00
(-) Cash Required (M)-1,052.00-657.50-394.50
(=) Excess Retained (M)1,405.001,799.502,062.50
(/) Shares Outstanding (M)1,233.501,233.501,233.50
(=) Excess Retained per Share1.141.461.67
LTM Dividend per Share2.272.272.27
(+) Excess Retained per Share1.141.461.67
(=) Adjusted Dividend3.413.733.94
WACC / Discount Rate6.75%6.75%6.75%
Growth Rate3.74%4.74%5.74%
Fair Value$117.53$194.33$412.50
Upside / Downside101.95%233.90%608.77%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)5,260.005,509.375,770.576,044.156,330.706,630.846,829.77
Payout Ratio53.29%60.63%67.97%75.32%82.66%90.00%92.50%
Projected Dividends (M)2,803.003,340.403,922.454,552.195,232.825,967.766,317.53

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate6.75%6.75%6.75%
Growth Rate3.74%4.74%5.74%
Year 1 PV (M)3,099.243,129.123,158.99
Year 2 PV (M)3,376.543,441.953,507.99
Year 3 PV (M)3,635.743,741.893,850.09
Year 4 PV (M)3,877.624,029.314,185.40
Year 5 PV (M)4,102.974,304.564,514.01
PV of Terminal Value (M)115,760.86121,448.79127,358.14
Equity Value (M)133,852.97140,095.63146,574.63
Shares Outstanding (M)1,233.501,233.501,233.50
Fair Value$108.51$113.58$118.83
Upside / Downside86.45%95.15%104.17%

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