Suncor Energy, Inc. (USA) (SU)

Canadian integrated oil and gas company whose stock price has risen 40% in the last twelve months. With energy needs here to stay this company can only continue to grow and it has outpaced its peers for the last two years.

Given the liklihood that the cost of extracting oil from the Middle East will continue to require extravagant costs of military entaglements and political dealings with corrupt governments, there will be increasing pressures to turn to alternative sources. Suncor's expanding production capacity in the Alberta oil sands, their diversification into alternative power production including wind energy, and the inevitable increase in the price of a barrel of oil, Suncor will continue to appreciate.

Suncor has been called "the future of the energy industry", and I agree. Out of all the integrated oils, I believe they are poised to profit the most from the steps they have taken in the last few years. There is absolutely nothing not to like about this company, the way I see it. Not only does it move up with the rest, investors already familiar with it tend to buoy the stock a bit while most others take a bigger hit. In a few years, even if the price of crude is at $50 a barrel, SU will be making money hand-over-fist.

A major source of oil in safe Canada. As oil becomes expensive and harder to find in the next few years this will be a big winner. As technology improves in the extracting process this stock will be a blue chip winner.

Major player in oil sands with lots of know how and ability to execute. They have vertical integration from mining to refining to retail through Sunoco. Also are moving into ethanol with 1 plant already and more on the way. Great medium to long term outlook.

Note: In 2005, SU was trading at this price level in mid-2005. At this time, the price of crude oil was trading at $50/barrel.

Pessimistic analysts are discussing $60 barrel oil, but none of them are telling us exactly how long that may last nor provides us with any guidance on the future direction once it hits that price.

My take?
Suncor is absolutely oversold. Their stock price may dip more in the short-term, but expect this stock to outperform over the next 5 years.

Those who originally intended to switch to alternative energy sources may find the cheaper oil prices as a disincentive to do so, holding it off - of course, this would be a terrible mistake. Energy demand and price is reaching a temporary decline which may actually spur an unintended increase in oil demand for the longterm. With a possibility of a global recession, China's growth forecasts have been cut to an '8% increase in GDP' -- Global Recession, and China is still growing almost 2-digits? Oil demand will continue to be strong in the future with countries such as China and India leading the spur in demand.

Suncor obtained approval on 11/14/06 to build a third oil sands upgrader and to develop an expansion mine. This new upgrader is planned to expand production to 500,000 b/d by 2012, and production is expected to rise to 350,000 b/d from the current 260,000 b/d in 2008. Suncor is in a key position in the Canadian oil sands reserves and is the largest producer of synthetic crude in Canada, surpassing Syncrude. As the most experienced company in mining and refining of oil sands Suncor will thrive, and estimates of cost of production of the synthetic crude continue to fall as the technology improves.

If peak oil is a hoax and you believe OPEC will provide the West with all the oil it needs at a fair price, then SU is a bad investment ... it is expensive to extract petroleum from the tar sands.
On the other hand, if peak oil is for real or the West decides to wean itself from Mideast oil, you want to buy Suncor now and hold it for the long term.
I am betting on the second scenario and am hot on SU. It is one of the most exciting long term investments around.

SUNCOR IS THE COMPANY THAT IS GOING TURN WESTERN ALBERTA INTO THE NORTH AMERICAN VERSION OF DUBAIS. THOSE OIL RICH SANDS ARE PROFITABLE TO PROCESS AT $118 A BARREL. THEY ARE IMPLEMENTING NEW TECHNOLOGIES AND CAN TURN A PROFIT AT $75 A BARREL.

Because this high capacity oil sands-based petroleum company has operations exclusively in the northern hemisphere, it is insulated from most risks associated with other oil stocks.

Alberta Canadas oil sands. Just spent 21 million on expansion, addressing enviromental impacts and getting responsoble about it. Suncor has been in uptrend for some time, and, I just love energy stocks.

Good alternative energy play. Natural gas is going to be more practical that Ethanol and some of the other choices. They are in on the Canadian Oil Sands. The US is going to be buying lots of their oil in the coming years. T.Boone Pickens likes this one.

I like buying oil close to home, in a country with a friendly government. Many things help raise oil prices temporarily, like terrorism, hurricanes, holy wars, confiscation by dictators, etc. Suncor probably won't suffer from any of these, but will benefit from the price increases when they occur anywhere else. Their oil and gasoline will cost less to transport to the US than foreign oil. Their raw material base is huge. The major oil fields in the middle east and north sea are in decline, and all the easy oil is gone.Oil production in the continental US has been declining since around 1974.

Demand for oil is mostly inelastic...overall demand will grow with the increasing world population even if per-capita consumption goes down. It doesn't get much better than this. Stick Suncor (or some basket of oil-sands stocks) in your IRA and relax.

No-brainer. Oil prices would have to drop a whole lot more to justify current valuation. This panic selling will subside. Worldwide thirst for energy will slow down a bit, but not disappear because of the recession. Great chance to get back into this company on the cheap.

In this bipolar market, investors are fleeing to quality. For those who like the oil industry, SU is a quality company with strong financials. SU posted strong earnings growth. It's revenue growth outpaced the industry average. Net cash flow increased.

Although SU's stock is a bit expensive in comparison to others in the industry and although its dividend/yield isn't the greatest, it is trading below its 52 week high and has room for the stock price to increase.

Just when you thought things couldn't get any worse
(housing bubble collapse, SIV's, CDO's, etc etc)

the price of oil takes off again
(more and more demand, while supply slowly shrinks, and some people will pay silly money to fuel their land yachts ...).

Suncor Energy is one of the big players in the Alberta Oil Sands. The amount of recoverable oil in this region is staggering. No drilling uncertainty. Location next door to the biggest oil market in the world will make Suncor a lot of money.

SU was recommended by both Cramer and Motley. Purchased in 2005 at $51. it continues to prosper and is at $108. after the two market wobbles. Take a look, good quality company, high demand product for many years to come. Go for it-- I think it will exceed $120. in the near term due to price gouging by oil companies. (bad news for consumer, good news for stock holders)

Oil sands name beaten down by year-low oil prices. As winter approaches and OPEC cuts production, look for SU to make a swift recovery.