Better Buy: Suncor Energy Stock or Cenovus Energy Stock?

Suncor Energy (TSX:SU) and Cenovus Energy (TSX:CVE) are great energy stocks to watch going into year-end.

| More on:
A worker overlooks an oil refinery plant.

Source: Getty Images

It’s the battle of the Canadian energy stocks in this piece, with Suncor Energy (TSX:SU) and Cenovus Energy (TSX:CVE) being stacked up. Undoubtedly, the energy patch had a great 2022, as technology stocks dragged down the broader market indices, primarily in the states.

This year has been a muted year for most energy stocks. And with West Texas Intermediate (WTI) prices recently dipping below US$70 per barrel this week, the oil producers have been hit with a bit of turbulence. Whether the plunge in oil prices is the start of something far worse going into 2024 remains a question mark at this juncture. Either way, recent pressure on oil stocks could prove buyable for investors seeking exposure to the space at a reasonable price of admission.

Indeed, investors are likely feeling pretty good going into the holiday season after a year of mega-cap-driven relief for the broad S&P 500 index. As markets begin to price in a rate cut (or more) at some point over the first half of 2024, we may see the market’s rally continue into the new year. And if there’s no rate cut to be found in the first or second quarter of 2024, stocks may be punished accordingly, especially if the winds of recession finally move in.

The case for energy stocks going into 2024

It’s hard (and not worthwhile) to time the markets, especially when investors start getting greedy again. When it comes to energy stocks, I view them as intriguing ways to further diversify your portfolio to better ready yourself for any unforeseen hailstorms.

Remember back in 2022 when energy stocks had the opportunity to shine? Though 2024 is highly unlikely to see a repeat of 2022, when energy stocks outdid tech plays, I do think that Canada’s top energy darlings are worthy buys on weakness. Don’t buy all in one go, though. I view them as great incremental buys over time, on the way down.

Energy stocks can be quite the choppy ride, after all. And dollar-cost averaging can help you deal with extreme levels of market chop.


Suncor is a great company that may have been discounted due to its past safety track record. The good news is that management is taking steps to improve. And in due time, I do believe the market will recognize and reward the firm for its progres on this front. At the end of the day, Suncor has great assets and the means to improve upon efficiencies over time through various initiatives.

At writing, the stock trades at 6.6 times trailing price-to-earnings (P/E) after its latest dip. With a 5% dividend yield and an impressive long-term trajectory, Suncor remains my top large-cap energy pick for those seeking to maximize value.


Cenovus is a spicier energy play, which fell 3% on Wednesday on the back of retreating oil prices. The stock is down around 24% from its October 2023 highs, retreating as the markets bounced back. Indeed, Cenovus stock has really cooled off but looks to be a better value for those still bullish on the long-term prospects for the energy scene. The stock yields 2.5% and goes for 10.4 times trailing P/E.

I think it’s a great buy for younger investors who can handle the amplified volatility.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Joey Frenette has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Energy Stocks

Mature financial advisor showing report to young couple for their investment
Energy Stocks

New Study Shows 36% of Couples Hide Spending From Partner, And It’s a Pressure Point

Having the hard talk? It can literally pay to do so. Here's how to stop holding out on your partner…

Read more »

Group of industrial workers in a refinery - oil processing equipment and machinery
Energy Stocks

2 Energy Stocks to Buy Hand Over Fist in February

Here are two of the best Canadian energy stocks you can buy in February 2024.

Read more »

Hand arranging wood block stacking as step stair with arrow up.
Energy Stocks

2 Growth Stocks That Could Skyrocket in 2024

Are you looking to add some growth to your investment portfolio this year? Here are two top growth stocks to…

Read more »

Utility, wind power
Energy Stocks

Is Brookfield Renewable Partners Stock a Buy Now?

Brookfield Renewable Partners continues to generate solid earnings, distribute higher dividends, and deliver above average capital gains.

Read more »

canadian energy oil
Energy Stocks

Better Energy Stock: SU or CNQ?

Suncor stock is grossly undervalued, as the company makes headway to recover from operational and safety challenges that have plagued…

Read more »

edit Woman calculating figures next to a laptop
Energy Stocks

How Long Would It Take to Turn $20,000 Into $100,000 With TSX Dividend Stocks?

TSX dividend stocks can convert a one-time $20,000 investment into $100,000 if you make your dividends work for you. Let’s…

Read more »

Senior Couple Walking With Pet Bulldog In Countryside
Energy Stocks

Retirees: Is Enbridge (TSX:ENB) the Best Dividend Stock for You to Buy Now?

Enbridge rallied in recent months. Are more gains on the way?

Read more »

potted green plant grows up in arrow shape
Energy Stocks

3 Stocks That Could Make You Significantly Richer in 2024

Three outperforming small-cap stocks could deliver outsized gains and make investors richer in 2024.

Read more »