Canadian natural resource stocks are a huge business today
Commodity plays really had a chance to flex their muscles last year as the 2022 tech sell-off took hold. In reality, oil and gas plays were not the most attractive investments for investors looking for significant gains in a short period of time.
As the tables turned and resource stocks surpassed tech names, naysayers were finally rewarded for their patience. Fast forward to today and the tables have turned again, with tech plays leading the way while oil and other commodity stocks cool off.Nobody knows if the tables will turn again in the second half of 2023. Regardless, I think investors should look to Canada's major commodity plays as essential portfolio diversifiers.
Time to go back to energy stores?
At this point, I see Canadian Natural Resources as a pretty interesting valuation option for investors looking to get back to value-oriented names as it tries to take a small slice of profit from its biggest year-to-date gain. date of winners, probable names in technical space.
Sure, it sounds like a bad idea to trim your portfolio's biggest winners. That said, I believe taking some money off the table whenever a stock exceeds your estimate of fair value is merely prudent. In any case, there are plenty of higher-yielding value plays on the TSX that I think could set investors on a path to outperform as we head into what could be a more volatile fall season.
Shares of Canadian Natural Resources have really started to gain momentum over the past month, rising nearly 8%. The price of oil has undoubtedly been steadily rising in recent weeks (West Texas Intermediate, or WTI, is just below $82 a barrel right now), which is helping CNQ stock move toward the upper end of its range. Ahead, CNQ shares could hit a new all-time high not seen since the first half of 2022.At the time of writing, the energy major's shares are trading at 9.47 times trailing price-to-earnings. That's still too cheap for the $88 billion king of Canada's energy patch, in my opinion.
While fluctuations in oil prices will likely cause additional volatility, I consider the 4.49% dividend yield to be more than a worthwhile wild ride. The stock currently boasts beta version 2.04. That means the stock is choppier than the broader market average — no surprises here, though. Commodity stocks are not exactly known to be fluid!
Further, if the Canadian recession is not as rocky as analysts expect, WTI prices may very well return to $100. All in all, I view CNQ stock as a great risk-reward trade-off for contrarian investors who may wish to rotate their portfolios towards value.Despite the modest price of admission, CNQ shares still have a good summer momentum behind them. CNQ stock really shows that you don't have to choose between momentum and value.
A foolish bottom line for investors
Shares of Canadian Natural Resources are down just 5.5% from their highs of $85 and change. In the second half, I think there is a good chance that stocks will be well above this level if oil prices continue to advance.The post Canadian natural resource stocks are a huge business today appeared first on The Motley Fool Canada.Should you invest $1,000 in Canadian natural resources?Before you think about Canada's natural resources, you'll want to hear this.Our research team just revealed the top 5 stocks for investors to buy in July 2023, and Canadian Natural Resources was not on the list.
Motley Fool Stock Advisor Canada, an online investment service they've been running for nearly a decade, is beating the TSX by 29 percentage points. And right now, he thinks there are 5 stocks that are better to buy.Crazy contributor Joey Frenette has no position in any of the stocks mentioned. The Motley Fool recommends Canadian Natural Resources. The Motley Fool has a disclosure policy
Investing in the stock market can be a rewarding experience, but it requires careful analysis and research to identify the best opportunities. In the field of energy stocks, Canadian Natural Resources stands out as a compelling investment option. CNQ shares offer a tremendous bargain as of today, representing an excellent opportunity for savvy investors to take advantage of the potential for substantial returns. In this article, we'll dive into the reasons why Canadian Natural Resources stock is an excellent choice and the relative keywords that make it an attractive investment opportunity.
Strong market position and resource base:
Canadian Natural Resources is one of the leading players in the energy sector and boasts a strong market position in Canada's oil sands and conventional oil and gas assets. With an extensive resource base, CNQ has a competitive advantage in terms of supply stability and long-term growth prospects. This strength attracts investors looking for companies with solid fundamentals and sustainable business models.
Undervalued share price:
Current market conditions have resulted in Canadian Natural Resources shares being undervalued, presenting a unique buying opportunity for investors. The relative keyword "undervalued" is essential to alert you to the potential profits that can be realized from stocks with strong underlying assets but temporarily low market value. As the energy market recovers and global demand for oil and gas increases, CNQ's share price is likely to rise and generate significant returns for early investors.
Attractive dividend yield:
In addition to its growth potential, Canadian Natural Resources also offers an attractive dividend yield, making it attractive to income-seeking investors. The keyword "dividend yield" highlights the company's commitment to rewarding shareholders and balancing investment strategies focused on growth and returns. Stable cash flow from its operations allows CNQ to maintain and potentially increase its dividend payments over time.
Commitment to ESG initiatives:
As environmental, social and governance (ESG) factors gain prominence in the investment world, companies that prioritize sustainability and responsible practices are becoming more attractive to investors. Canadian Natural Resources is actively involved in a variety of ESG initiatives, such as reducing greenhouse gas emissions, promoting community engagement and improving workplace safety. Including relevant ESG-related keywords in discussions of CNQ's sustainability efforts can attract socially conscious investors who value companies that prioritize corporate responsibility.
Canadian Natural Resources represents a remarkable investment opportunity for savvy investors looking for a great deal in the energy sector. Its strong market position, large resource base, undervalued share price, attractive dividend yield and commitment to ESG initiatives make it an attractive choice for both long-term growth and income oriented investors. As the energy market recovers and global demand grows, CNQ stock is poised to deliver significant returns. By strategically considering relative keywords throughout the article, we've highlighted the reasons why Canadian Natural Resources stock is an exceptional option that investors should seriously consider adding to their portfolios. However, as with any investment, it is key to do your research and seek professional financial advice before making any decisions.
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