Imperial Oil Stock Near 52-Week High: Should You Consider Buying?

Shares of Imperial Oil Limited IMO closed at $92.96 on Monday, near its 52-week high of $93.09, following a gain of 38.6% in a year. During the same time period, the company’s shares outperformed the sub-industry and the broader oil and energy sector’s rise of 8.9% and 4.5%, respectively.

Peer comparison further highlights the strength, as Imperial Oil conveniently outperformed its peers, Gibson Energy Inc. GBNXF, Suncor Energy Inc. SU and Cenovus Energy Inc. CVE,which gained 14.3%, 15% and 4.4%, respectively, in the past year.

IMO Outperforms Industry, Sector & Peer Companies (GBNXF, SU, CVE)

Imperial Oil stands out as one of Canada’s most resilient and growth-ready energy companies with a diversified portfolio spanning upstream, downstream and chemicals. Its strong upstream assets — Kearl, Cold Lake and Syncrude — deliver competitive costs, while its downstream and retail presence ensures steady cash flows even in volatile markets. Backed by ExxonMobil’s majority ownership, Imperial Oil benefits from unmatched financial strength and access to low-cost capital. Record production levels, efficiency gains and disciplined shareholder returns signal a company positioned not just to weather cycles but to create long-term value.

With the stock already achieving its 52-week high, investors are left grappling with a critical question: Should they ride the momentum or take profits at the peak and exit? Let us dig deeper into the company’s prospects to determine if it has enough room to rise further.

Factors Favoring Imperial Oil Stock

Record-Setting Production Performance: Upstream production averaged 427,000 barrels of oil equivalent per day (boe/d) — the highest second-quarter level in more than 30 years. Notably, Kearl achieved a record 275,000 gross barrels per day, a testament to operational excellence and reliability improvements. With Cold Lake steady at 145,000 boe/d and Syncrude rising to 77,000 boe/d, Imperial Oil has demonstrated consistent growth across its core assets. These milestones reinforce the company’s ability to sustain high output, positioning it to capture upside when energy prices recover.

Strategic Investment in Renewable Energy: Imperial Oil is not only strengthening its conventional oil and gas portfolio but also leading Canada’s energy transition. The company recently completed Canada’s largest renewable diesel facility at its Strathcona refinery, with first production already underway. This project, backed by multiple provincial governments, is expected to deliver attractive returns while advancing lower-carbon solutions. By diversifying into renewables, Imperial Oil enhances its long-term sustainability profile and positions itself to benefit from increasing demand for cleaner fuels.

Shareholder-Friendly Capital Returns: Imperial Oil has a strong track record of prioritizing shareholder value, returning over C$20 billion since 2020, including C$15 billion in buybacks. In the second quarter of 2025, it distributed C$367 million in dividends and declared a quarterly dividend of 72 Canadian cents per share, marking continued growth in payouts. The company also announced accelerated share repurchases under its Normal Course Issuer Bid program, alongside steady dividend growth, which has compounded at an annual rate of 23% over the past five years. Such commitments reflect management’s confidence in future cash flows and provide shareholders with both income stability and capital appreciation potential. Although Imperial has a strong track record of dividend payouts with an annualized yield of 2.3%, it lags behind its peers, as Cenovus Energy, Gibson Energy and Suncor Energy provide an impressive annualized yield of 3.5%, 6.7% and 3.9%, respectively.

Strong Balance Sheet and Growth Projects Ahead: Imperial Oil ended the second quarter with C$2.4 billion in cash and modest debt of C$4 billion, highlighting a strong balance sheet that provides financial flexibility. Growth initiatives, such as the Leming SAGD redevelopment, expected to bring first oil by late 2025, further strengthen the company’s medium-term outlook. Peer comparison further highlights Imperial Oil’s strength, as Cenovus Energy and Suncor Energy have crippling long-term debt of C$7.06 billion and C$8.6 billion, respectively.

Conclusion

Imperial Oil has firmly established itself as a leading Canadian energy producer with a diversified business model that balances upstream strength with downstream stability. Record-setting production performance underscores its efficiency and reliability, while the renewable diesel project demonstrates forward-looking investments in clean energy. The company’s robust balance sheet, consistent shareholder returns and backing from ExxonMobil provide strong growth visibility in the near term. With continued project expansions and outstanding stock price performance, outpacing peers like Cenovus Energy, Suncor Energy and Gibson Energy along with the broader sector, this Zacks Rank #2 (Buy) stock is worth buying.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research