Suncor Energy Inc. (SU) DCF Valuation
TGM's two-stage DCF values Suncor Energy Inc. (SU) between $110.39 and $222.46 depending on assumptions, with a base case of $153.52. Growth is taken from the company's own record (5-year revenue CAGR (FCF growth too volatile to use)), fading to 2.5% long-run; the discount rate (7.5%) reflects its beta.
What would today's price require?
$56.23 is justified only if free cash flow grows about -8.2% a year (fading to 2.5% long-run) at a 7.5% required return — slower than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 10.5%/yr | 8.5% | $110.39 |
| Base case | 13.5%/yr | 7.5% | $153.52 |
| Optimistic | 16.5%/yr | 6.5% | $222.46 |
| Analyst DCF (FMP) | independent reference — different model | $136.65 | |
Current Price
$56.23
Market-Implied Growth
-8.2%/yr
vs +13.5% 5Y actual
Model Scenario Range
$110.39 – $222.46
model output — not a price target
SU DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for SU (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $5.8B · 1.18B shares · net debt $7.9B
Estimated Fair Value
$234.18
+316.5% vs $56.23
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 13.5%/yr FCF growth and 10-year horizon fixed. Green = above today's $56.23; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 5.5% | $328 | $366 | $418 | $490 | $598 |
| 6.5% | $253 | $275 | $303 | $338 | $385 |
| 7.5% | $204 | $218 | $234 | $254 | $280 |
| 8.5% | $169 | $178 | $189 | $202 | $217 |
| 9.5% | $143 | $149 | $157 | $165 | $175 |
About Suncor Energy Inc.
Suncor Energy Inc. operates as a fully integrated energy enterprise. Its primary focus involves the development of hydrocarbon resources, particularly within Canada's Athabasca oil sands region. Globally, the company undertakes the exploration, acquisition, development, production, transportation, refining, and marketing of crude oil. Domestically, it distributes petroleum and petrochemical products, predominantly under the Petro-Canada brand. Suncor's operations are divided into several key segments: The Oil Sands division extracts bitumen through both mining and in-situ techniques, converting it into refinery feedstock and diesel, or blending it for direct market sale. The Exploration and Production segment manages offshore assets off Canada's East Coast and in the North Sea, in addition to onshore properties in Libya and Syria. The Refining and Marketing segment processes crude oil and intermediate feedstocks into a variety of petroleum and petrochemical goods, which are then sold to retail, commercial, and industrial customers via its network of distributors. The Corporate and Eliminations segment also oversees the operation of four wind farms situated in Ontario and Western Canada. Beyond these core activities, Suncor is also engaged in the trading and marketing of crude oil, natural gas, various byproducts, refined products, and electricity. Established in 1917, the company was initially known as Suncor Inc. before officially changing its name to Suncor Energy Inc. in April 1997. Its corporate headquarters are located in Calgary, Canada.
- Sector
- Energy
- Industry
- Oil & Gas Integrated
- CEO
- Richard Kruger