Stock market investing is a way to put your money to work for you to generate the kind of returns you might not get with fixed-income assets like Guaranteed Income Certificates (GICs). While the returns are not guaranteed, identifying and investing in the right TSX stocks can deliver far greater returns in the long run compared to simply earning interest income on cash sitting idle in a high-interest savings account.
One of my top picks when I think of blue-chip TSX stocks that are staples in Canadian investor portfolios, perfect as long-term investments, Suncor Energy (TSX:SU) is one of the first that comes to mind.
Oil prices fluctuate, leading to problems for oil companies focused on exploration and production operations. However, diversified oil companies with integrated business models enjoy a certain degree of protection from volatility and outperform most peers despite lower oil prices. Suncor is one such integrated energy company that can be found in many self-directed investment portfolios.
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Suncor Energy
Suncor is a $90.71 billion market-cap integrated energy company with operations that include crude oil and natural gas production through its oil sands operations and traditional oil regions, including offshore facilities. Suncor’s operations go beyond exploration and production. Except for midstream operations, Suncor has a presence in every subsector of the North American energy industry.
The company extracts and sells crude oil, refining it into chemicals and other fuels through its infrastructure. The company also operates gas stations and has a small but growing presence in the renewable energy area, but has since sold its assets in the green energy space to focus on its core business.
An investor favourite
Suncor Energy is a stock that highlights the commitment to shareholder returns by publicly traded companies. As of this writing, Suncor stock trades for $76.23 per share, up by almost 75% from its 52-week low. The stock has been doing well in the market, and the company has been busy buying back shares. To make it even more attractive to investors with a long investment horizon, it has also increased its dividend by 15.4% since 2023.
Between its dividend hikes, capital gains, and share buybacks, the stock brings additional value to its investors. 2026 has seen Suncor increase its buybacks by 10%, with the stock expected to complete approximately $3.3 billion in repurchases. The fewer the number of shares available in the market, the more value each share will have, thereby increasing the value for existing investors.
Foolish takeaway
The break-even price range for crude oil to benefit Suncor Energy stock is in the low $40s, and oil prices today are in the mid-$60 range. The demand for crude oil is expected to remain high for the coming years, and higher prices will continue benefiting Suncor Energy and its investors. Suncor is expected to outline its improvement plans for up to the next 15 years in March 2026.
According to its management, Suncor plans to become a reliable and predictable industrial company that focuses on creating value and shareholder returns. It remains to be seen how that can play out, but the stock looks well-positioned to deliver on that promise. I would seriously consider adding this oil stock to my self-directed investment portfolio at current levels.