Q: HELLO PETER AND COLLEAGUES,
Five years ago I was willed a (small) number of shares in Suncor, which seems to have gone through some ups and downs the last few years (more downs than ups when it comes to CEO's replacements and other issues...) but seems to have stabilized somehow lately. Notwithstanding, do you consider CNQ a better run corp with a better chance of success, and should I, for the intermediate time when owning shares in an old fashion energy business still makes some sense, switch my SU position to an equivalent CNQ one? Thank you.
Five years ago I was willed a (small) number of shares in Suncor, which seems to have gone through some ups and downs the last few years (more downs than ups when it comes to CEO's replacements and other issues...) but seems to have stabilized somehow lately. Notwithstanding, do you consider CNQ a better run corp with a better chance of success, and should I, for the intermediate time when owning shares in an old fashion energy business still makes some sense, switch my SU position to an equivalent CNQ one? Thank you.
5i Research Answer:
CNQ is probably a 'better' overall company but SU is 'cheaper' with a higher yield so it becomes a bit of a wash. SU has outperformed CNQ in the short term but not in the long term. We think both are fine and priced well. We would be OK with a switch but would not deem it as completely necessary. We would be far less likely to switch if taxes apply to a SU sale.