Canadian Natural Resources (TSX:CNQ): Assessing Valuation Following Recent Share Price Momentum

Canadian Natural Resources (TSX:CNQ) shares have seen some momentum lately, gaining over 10% in the past month. Investors are watching the stock, curious about what is driving that uptick and considering whether it is sustainable.

See our latest analysis for Canadian Natural Resources.

That recent burst in Canadian Natural Resources' share price comes after a stretch of moderate gains earlier this year, suggesting momentum could be building. While the 1-month share price return stands out at nearly 11%, the 1-year total shareholder return is a more modest 1.9%. Long-term holders have enjoyed a remarkable 287% total return over five years. Overall, short-term trading has perked up even as the broader performance continues to reflect the stock's sturdy fundamentals.

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But with shares up sharply over the past month and analysts assigning a price target that is still notably higher than today’s value, the question remains: Is Canadian Natural Resources undervalued, or is the market already factoring in its future growth?

Most Popular Narrative: 10.8% Undervalued

Canadian Natural Resources’ fair value, as calculated in the most widely followed narrative, stands well above its recent closing price. This gap, along with investor optimism, is fueling debate over what is really underpinning CNQ’s current valuation strength.

Recent accretive acquisitions have expanded production and reserves with minimal increase to the 2025 capital budget. This positions Canadian Natural for immediate cash flow growth and increased future revenues as these assets are developed.

Read the complete narrative.

What key assumptions drive such a premium value? Hint: It is not just about today’s profits. Want to uncover which financial forecasts and margin shifts push the fair value this high? See the story behind the price target and the numbers moving the model.

Result: Fair Value of $52.83 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent regulatory pressures or a prolonged slump in oil demand could challenge the current optimism and put pressure on future returns.

Find out about the key risks to this Canadian Natural Resources narrative.

Build Your Own Canadian Natural Resources Narrative

If you see things differently, or want to run the numbers your way, you can craft your own narrative in just a few minutes: Do it your way

A great starting point for your Canadian Natural Resources research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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