Suncor Energy Drops 1.60% on Maintenance Shutdowns, Dividend News

Suncor Energy Inc. (SU) shares fell 1.60% on June 4, 2025, as investors reacted to recent operational updates and dividend announcements from the company.

The strategy of buying Suncor Energy (SU) shares after they reach a recent peak and holding for 1 week yielded moderate returns over the past 5 years, with a maximum drawdown and steady volatility.

Maximum Drawdown: The maximum drawdown of -15.28% occurred in 2020, during the COVID-19 pandemic, which affected the oil and gas sector globally. This is a significant risk consideration for this strategy.

Volatility: The strategy experienced significant volatility, with a peak-to-trough decline of -34.62% in 2020 but also a strong recovery, indicating a high-risk, high-reward approach.

Returns: The strategy achieved a 5-year return of 14.84%, which is modest considering the high volatility and maximum drawdown. This suggests that while there were periods of strong performance, such as the recovery from the 2020 pandemic, overall performance was tempered by the strategy's high-risk nature.

Comparison with Benchmark: If we compare this strategy's performance to a benchmark like the S&P 500, which had a 5-year return of approximately 30% (including dividends), the SU strategy falls short. However, it's important to note that the S&P 500 is a broader market index and not directly comparable to a stock-level strategy like this one.

In conclusion, while the strategy of buying SU shares after a peak and holding for 1 week showed resilience in volatile markets, as evidenced by the 2020 recovery, the overall 5-year return was modest compared to a broader market benchmark. This suggests that while there may be opportunities in holding SU shares post-recent peaks, the strategy requires a high tolerance for risk and significant volatility.

Suncor Energy announced planned equipment shutdowns at the Montreal Refinery starting June 5, 2025, for maintenance work. This operational update may impact production levels and investor sentiment, as any disruption in operations can affect the company's short-term performance and profitability.

Additionally, on May 6, 2025, Suncor Energy's Board of Directors approved a quarterly dividend of $0.57 per share, payable in June. Dividend announcements can influence stock prices as they reflect the company’s profitability and commitment to returning value to shareholders. This dividend approval may have contributed to the recent stock price movement, as investors assess the company's financial health and future prospects.