Should You Add Canadian Natural Stock to Your Portfolio Now?

Canadian Natural Resources Limited CNQ is among Canada’s largest independent energy producers, with a diversified portfolio of crude oil, natural gas and natural gas liquids. Its operations span Western Canada, the North Sea and offshore West Africa, built over decades of disciplined growth and financial strength. Anchored by a long-life, low-decline asset base, the company generates reliable cash flows and maintains flexibility in capital allocation. A balanced mix of light and heavy oil, bitumen, synthetic crude and natural gas ensures resilience across cycles. In contrast, oil sands, thermal and recovery projects reinforce its standing as a leading global independent company.

In today’s dynamic market environment, making the right call on a stock can significantly impact an investor’s portfolio. With shifting economic indicators, evolving industry trends and company-specific developments, investors must continually reassess their positions. Let us take a closer look at Canadian Natural's current standing and outcomes to determine whether it is time to buy, sell or hold the stock.

CNQ’s Performance Overview

Canadian Natural’s shares have gained 2.4% year to date (YTD), outperforming the Oil & Gas Drilling sub-industry’s growth of 0.1% and the broader oil and energy sector's rise of 2%. Peer comparison further highlights the strength, as Paramount Resources Ltd. PRMRF, Baytex Energy Corp. BTE and Gran Tierra Energy Inc. GTE fell 26.8%, 8.5% and 38.7%, respectively, during the same period.

CNQ, PRMRF, BTE & GTE’s YTD Stock Performance

CNQ Stock’s Upward Earnings Estimate

Over the past 60 days, analysts have raised the estimate for CNQ’s 2025 earnings per share from $2.27 to $2.31, marking a 1.8% upward revision that reflects confidence in the company’s growth outlook.

CNQ’s Estimate Revisions

CNQ’s Strong Oil Sands Operations

Canadian Natural continues to showcase the strength and reliability of its Oil Sands Mining & Upgrading operations, a key pillar of its overall production. In the last reported quarter, the company’s synthetic crude oil output averaged around 464,000 barrels per day — a 13% increase from second-quarter 2024. This performance reflects disciplined execution, strong plant reliability and effective maintenance planning. CNQ’s long-life, low-decline oil sands assets remain central to its long-term strategy, providing stable production and cost efficiency across price cycles. With a focus on operational optimization and cost reduction, the company continues to enhance reliability and maximize value from existing infrastructure while maintaining low per-barrel operating costs.

CNQ’s Dividend Advantage

Canadian Natural stands out as a strong candidate for high shareholder yield due to its attractive dividend payments, consistent share buybacks and effective debt management. The company offers a competitive dividend yield of around 5.5%, notably above the Zacks Oil/Energy sector’s average of 3.9% and competitive with its peers like Paramount Resources, Baytex Energy and Gran Tierra, which yield an average annual rate of only 2.8%.

CNQ has increased its dividend payout 18 times in the past five years, reflecting an annualized dividend growth rate of 23.3%. The payout ratio of 64% indicates that the company is paying less than its income, which is sustainable over the long term. This also reflects that CNQ is keeping funds for better investment opportunities. The company’s shareholder yield remains impressive, making it a compelling choice for investors seeking a combination of income and capital appreciation while benefiting from disciplined capital allocation.

CNQ’s Diversified Portfolio

Canadian Natural boasts a diversified portfolio of low-risk exploration and development projects with strong international exposure, ensuring sustained long-term growth. Its balanced production mix — 35% synthetic crude oil (SCO), 29% heavy crude, 26% natural gas and 10% light crude — supports consistent value creation and reduces overall risk. A key strength lies in its extensive SCO reserve base, offering an impressive 43-year reserve life. This long-duration, high-quality resource foundation sets CNQ apart from U.S. shale producers facing declining inventories, reinforcing its position as a stable, lower-risk investment with reliable production and strong long-term valuation potential.

CNQ’s Strategic Acquisitions

Canadian Natural has built a strong track record of prudent, well-timed and accretive acquisitions that have consistently strengthened its competitive edge against peers such as Paramount Resources, Baytex Energy and Gran Tierra, while diversifying its portfolio and bolstering its financial performance. Landmark deals include the 2017 purchase of the Athabasca Oil Sands Project for $8.5 billion, which added significant value to its asset base and strengthened long-term cash flow generation, as well as the $807 million acquisition of Pelican Lake heavy oil assets and the 2019 buyout of Devon Canada, which further expanded its oil sands footprint. The acquisition of Painted Pony Energy reinforced its natural gas position.

At the same time, recent deals — such as the Palliser Block, which added about 1.1 million net acres and 850 drilling locations, and Montney assets, contributing about 32,000 barrels of oil equivalent per day production and 120,000 net acres — provide immediate production, reserves growth and strong synergies with existing operations. Together, these acquisitions enhance inventory depth, improve capital efficiency and position Canadian Natural for sustainable free cash flow growth and resilient shareholder returns.

Final Thoughts on CNQ Stock

The Zacks Rank #1 (Strong Buy) company stands out as a top-tier investment for long-term, income-focused investors. With strong free cash flow, low breakeven costs and a diversified global portfolio, Canadian Natural ensures stability across market cycles. Its 43-year reserve life, disciplined capital management and 25-year dividend growth record highlight sustained value creation. The company’s robust oil sands performance, strategic acquisitions and 5%+ dividend yield make it a resilient, high-quality pick. With shares already up 2.4% year to date — outpacing peers like Paramount Resources, Baytex Energy and Gran Tierra and the broader energy sector — CNQ offers a rare mix of steady income, growth potential and dependable performance across commodity cycles. Therefore, for investors seeking reliable income and long-term growth, Canadian Natural stock is worth buying.

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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