Suncor Energy Inc. (TSX:SU) has seen its stock price rally significantly over the last three years – up 33% to all-time highs – despite a 26% decline in the price of oil. But what’s in store for Suncor Energy stock for 2026? Can it continue to perform so well or will it take a breather?
Let’s look into these questions.
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Suncor gets its act together
After years of safety issues and less than ideal operating results, Suncor turned a new leaf in April 2023, with the hiring of a new CEO. This hire has proved to be exactly what Suncor needed to turn things around. The result is a new Suncor – one that is extracting more and more profit and returns from its business.
This turnaround has been met with enthusiasm across the board. Fewer safety incidents, better utilization of assets, and an all-around focus on reducing costs has boosted profitability and morale at the company. At this point, the momentum is continuing, with Suncor exceeding expectations on all fronts.
Let’s take Suncor Energy’s most recent quarterly result, the third quarter of 2025. In this quarter, upstream production came in at its highest third quarter level ever. Also, upgrader utilization came in at 102%, and product sales posted its highest quarter ever.
Suncor stock: Dividends and shareholder returns
I’d like to remind you of Suncor’s stated objective – to return 100% of excess funds flow to shareholders. In the third quarter, Suncor’s adjusted funds from operations came in at $3.8 billion or $3.16 per share. This was the second highest third quarter in history. This result was achieved despite lower WTI oil prices. Not a small feat.
In the quarter, Suncor returned $1.4 billion to shareholders, which included $750 million in share buybacks and $650 million in dividend payments. As a result of sustainably growing its free funds flow, Suncor instituted a 5% dividend raise in the quarter, to $2.40 per share.
Guidance
While 2026 guidance from management has not been released yet, we can look to Suncor Energy’s 2025 guidance for now. For 2025, production is expected to come in between 845 and 855 million barrels of equivalent oil per day (boe/d). This is roughly two to three percent higher than last year. Also, refinery crude oil processed is expected to come in between 470–475 million barrels a day (mbbls/d). This is one to two percent higher than last year.
A key note to make here is that management expects to come in at the high end of its guidance. Additionally, the company’s capital expenditures will come in at the low end of management’s guidance. This has been made possible in part by the company’s strong performance on regular plant maintenance, which has been coming in ahead of schedule and below cost estimates.
The bottom line
Suncor has increasingly turned its business into one that’s less and less reliant on oil prices to perform well. This has been made possible by the company’s diversification and its vertical integration, which means that it has exposure to the entire oil and gas value chain.
2026 is likely to see continued momentum and value creation out of Suncor. Therefore, I think it’s a solid buy for 2026. And there’s something for dividend investors as well – a growing dividend and a 3.8% yield.
