Why Canadian Natural's Dividend Story Keeps Getting Stronger

Canadian Natural Resources Limited (CNQ) continues to demonstrate how disciplined capital allocation can translate into consistent shareholder value. The company boasts an exceptional track record of 25 consecutive years of dividend increases, one of the longest streaks among global oil producers. Since 2001, CNQ’s dividend has seen a compound annual rate of roughly 21%, underscoring management’s commitment to returning capital even through volatile commodity cycles.

In the first half of 2025, Canadian Natural returned approximately C$4.6 billion to its shareholders through a combination of dividends and share repurchases. The company’s dividend growth remains notable — from C$1.775 per share in 2023 to C$2.075 in 2024, and an annualized C$2.35 per share in 2025 — highlighting its ability to sustain and raise payouts even during periods of low commodity prices.

CNQ’s focus on cost efficiency and balanced capital spending has enabled it to maintain these payments while preserving a strong balance sheet. Once net debt reaches its C$12 billion target, Canadian Natural plans to return 100% of free cash flow to its shareholders — an approach that further reinforces its disciplined financial framework.

This unwavering dividend philosophy has become central to CNQ’s identity. Rather than pursuing aggressive expansion, the company continues to prioritize predictable, shareholder-friendly returns. Its consistent dividend growth — backed by resilient free cash flow and robust operational execution — illustrates how Canadian Natural has evolved into a model of stability in the energy sector, turning capital discipline into one of its most defining competitive strengths.

Canadian Energy Operators With Dividend Strength in Focus

Baytex Energy (BTE) maintains a disciplined dividend strategy focused on balance sheet strength and sustainable shareholder returns. Baytex Energy allocates 100% of free cash flow to debt reduction after funding its quarterly dividend. Over the long term, Baytex Energy aims for reliable dividend growth, complemented by opportunistic share buybacks.

Cenovus Energy (CVE) has built a strong record of rewarding shareholders through steady and growing dividends. Cenovus Energy targets roughly 100% return of excess free funds flow while sustaining payouts even at $45 WTI. With five straight years of double-digit base dividend growth, Cenovus Energy continues delivering consistent, shareholder-focused returns.

The Zacks Rundown on Canadian Natural Resources

Shares of CNQ have gained 14.7% in the past six months compared with the Oil/Energy sector’s increase of nearly 13%.

From a valuation perspective — in terms of forward price-to-earnings ratio — Canadian Natural Resources is trading at a premium compared with the industry average.

See how the Zacks Consensus Estimate for CNQ’s earnings has been revised over the past 60 days.

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

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

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