Imperial Oil (TSX:IMO) has been on a remarkable run in recent years, surging by over 360% over the last five years. That kind of performance is rare — especially for a century-old energy giant operating in a sector as cyclical as oil and gas.
But with commodity prices stabilizing and the energy transition gaining momentum, many investors are now asking where Imperial stock goes from here. Can it build on its momentum, or will market volatility and demand shifts weigh on its future returns? In this article, I’ll take a forward-looking view on where Imperial Oil stock could be five years from now and what investors can expect in terms of growth and resilience.
Imperial Oil stock
As of now, Imperial Oil stock trades around $98.50 per share and carries a market cap of $50.1 billion. While it’s not a high-yielding stock, the company does offer a 2.9% annualized dividend, paid quarterly. While its momentum has slowed a bit recently, IMO stock remains up around 11% year to date.
The oil and gas market has had its fair share of ups and downs in recent years, and Imperial Oil stock has moved in step with those shifts. That said, the company’s latest results show that it’s managing the turbulence better than most.
In the first quarter of 2025, Imperial’s net profit climbed by nearly 8% YoY (year over year) to $1.3 billion. The company’s downstream margins remained strong with the help of solid fuel demand and higher refinery utilization despite colder weather affecting upstream production at its Kearl site.
Moreover, Imperial is holding up well against inflation and supply challenges. With cash flow from operations hitting $1.5 billion in the March quarter and a balance sheet that continues to improve, IMO stock has been maintaining solid footing even as oil prices level out.
Delivering on cash flow and growth
In the first quarter, Imperial’s revenue rose nearly 2% YoY to $12.5 billion. And perhaps most importantly for dividend-focused investors, the company declared another increase in its quarterly dividend to $0.72 per share. Imperial has now raised its dividend for 30 consecutive years while also buying back 39% of its shares since 2018.
With its free cash flow reaching $1.15 billion in the first quarter alone, it’s clear that Imperial is still delivering where it matters most: on real returns for shareholders.
Where will IMO stock be in five years?
Notably, Imperial is investing in long-life, low-decline assets with consistent volume growth. Its projects like Grand Rapids and Leming are already showing strong results, and the renewable diesel facility at Strathcona is on track for startup in mid-2025. These moves are not only expected to add to the company’s production capacity but also help reduce its carbon footprint.
With its focus on further lowering unit costs, strong cash generation, and access to ExxonMobil’s expertise, I wouldn’t be surprised if Imperial Oil stock doubles, or even triples, in value over the next five years. And if you’re looking at the long term, this might just be one of those energy stocks worth hanging onto.
