Imperial Oil (IMO) AI Stock Analysis

• Market Cap: $76.52B
• Dividend Yield: 2.45%
• Average Volume (3M): 878.99K
• Price to Earnings (P/E): 24.4
• Beta (1Y): 1.20
• Revenue Growth: -6.18%
• EPS Growth: -14.06%
• Country: CA
• Employees: 5,100
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Integrated
• EPS (TTM): 1.97
• Shares Outstanding: 483,592,700
• 10 Day Avg. Volume: 723,848
• 30 Day Avg. Volume: 878,991
• PEG Ratio: -0.65
• Price to Book (P/B): 2.68
• Price to Sales (P/S): 1.27
• P/FCF Ratio: 12.70
• Enterprise Value/Market Cap: 1.07
• Enterprise Value/Revenue: 1.77
• Enterprise Value/Gross Profit: 10.80
• Enterprise Value/Ebitda: 12.15
• 1Y Price Target: $120.22
• Price Target Upside: -24.41% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 9
• EPS Forecast (FY): 6.66
• Revenue Forecast (FY): $49.63B

• Rating: 75 Outperform
• Price Target: C$186.00 ▲(16.96% Upside)
• Action: Reiterated Date: 02/22/26
• Date: Action: Reiterated 02/22/26

The score is driven primarily by strong financial resilience (low leverage and meaningful free cash flow) and bullish technical trend/momentum. Offsetting factors are a less attractive valuation (higher P/E and modest yield) and earnings-call risks from segment softness plus sizable restructuring/impairment charges despite solid operational performance and cost-reduction plans.

Positive Factors

Low leverage / strong balance sheet

Imperial's low debt-to-equity (~0.18) and sizable equity base (~C$22.3B of ~C$42.3B assets) provide durable financial flexibility. This balance-sheet strength supports capital allocation for maintenance, growth, and shareholder returns and helps absorb commodity-cycle shocks over months.

Robust cash generation and free cash flow

Sustained operating cash flow (~C$6.7B TTM) and meaningful free cash flow (~C$4.7B TTM) underpin the firm's ability to fund capex, dividends, and buybacks without immediate financing. Strong cash conversion enhances resilience and strategic optionality across a multi-month horizon.

Integrated operations with high utilization and record production

Record Kearl production (316k bpd) plus 98% refinery utilization demonstrate the benefit of integrated upstream-downstream operations. High throughput and steady volumes improve margin capture, reduce per-unit costs, and support reliable cash flow generation over the medium term.

Negative Factors

Commodity sensitivity and margin normalization

Imperial's earnings and cash flow remain exposed to oil/gas price swings and cyclicality. TTM margins and revenue have cooled from prior peaks, meaning profitability and free cash flow can materially fluctuate with commodity markets, raising medium-term earnings volatility risk.

Restructuring and impairment charges

Recent non-recurring charges (a $330M restructuring pre-tax and a $406M impairment pre-tax) reduced reported earnings and signal asset rationalization. Such charges can temporarily depress profitability and may indicate structural asset repricing or cost base adjustments affecting multi-month financial metrics.

Declining revenue and earnings trends; weak chemicals margins

Reported revenue and EPS growth show notable declines and the chemical segment has weaker margins and lower earnings. These trends point to structural pressures in select businesses that can restrain overall profitability and cash generation for several quarters absent recovery or strategic fixes.

Imperial Oil Business Overview & Revenue Model

Company Description

Imperial Oil Limited engages in exploration, production, and sale of crude oil and natural gas in Canada. The company operates through three segments: Upstream, Downstream and Chemical segments. The Upstream segment explores for, and produces crude oil, natural gas, synthetic oil, and bitumen. As of December 31, 2021, this segment had 386 million oil-equivalent barrels of proved undeveloped reserves. The Downstream segment is involved in the transportation and refining of crude oil, blending of refined products and the distribution, and marketing of refined products. It also transports crude oil to refineries by contracted pipelines, common carrier pipelines, and rail; maintains a distribution system to move petroleum products to market by pipeline, tanker, rail, and road transport; and owns and operates fuel terminals, natural gas liquids, and products pipelines in Alberta, Manitoba, and Ontario. In addition, this segment markets and supplies petroleum products to motoring public through approximately 2,400 Esso and Mobil-branded sites. Further, it sells petroleum products, including fuel, asphalt, and lubricants for industrial and transportation customers, independent marketers, and resellers, as well as other refiners serving the agriculture, residential heating, and commercial markets through branded fuel and lubricant resellers. The Chemical segment manufactures and markets various petrochemicals, benzene, aromatic and aliphatic solvents, plasticizer intermediates, and polyethylene resin. Imperial Oil Limited has a strategic agreement with E3 Metals Corp. to advance a lithium-extraction pilot in Alberta. The company was incorporated in 1880 and is headquartered in Calgary, Canada. Imperial Oil Limited is a subsidiary of Exxon Mobil Corporation.

How the Company Makes Money

Imperial Oil generates revenue primarily through its integrated business model, which includes upstream exploration and production, downstream refining, and marketing operations. The company earns money through the sale of crude oil and natural gas produced from its oil sands and conventional production assets. In the downstream segment, Imperial refines crude oil into various petroleum products and sells them through its retail network and commercial channels. Key revenue streams include the sale of gasoline and diesel at its retail stations, as well as the production and sale of petrochemicals. Significant partnerships, such as joint ventures with other energy companies and collaborations related to technology and sustainability initiatives, also contribute to its earnings. Additionally, fluctuations in global oil prices and operational efficiencies play crucial roles in influencing the company's profitability.

Imperial Oil Financial Statement Overview

Summary

Financials are solid overall, led by a strong balance sheet (low leverage with ~0.18 debt-to-equity and sizable equity base) and robust cash generation (TTM operating cash flow ~C$6.7B; free cash flow ~C$4.7B). The main offset is cyclical normalization: TTM revenue and margins have cooled versus 2022–2024 peak levels, and results remain commodity-sensitive.

Income Statement

Imperial Oil shows solid profitability in the current cycle, with TTM (Trailing-Twelve-Months) revenue of ~C$46.6B and positive margins (gross ~16.3%, operating ~9.0%, net ~7.0%). However, earnings power has clearly cooled versus 2022–2024: TTM revenue is down (~-3.0% growth rate provided) and margins/profits have compressed from 2022 peak levels (2022 net margin ~12.3% vs. TTM ~7.0%). The 2020 loss highlights commodity sensitivity, though results have remained profitable since.

Balance Sheet

The balance sheet is a clear strength: leverage is low with debt-to-equity around ~0.18 in TTM (Trailing-Twelve-Months) and consistently below ~0.25 across the period. Equity is sizable (~C$22.3B TTM) against ~C$42.3B assets, supporting resilience through downturns. Returns on equity remain healthy (TTM ~14.5%), though down from very strong 2022–2024 levels, indicating normalization in profitability rather than balance-sheet stress.

Cash Flow

Cash generation remains strong in absolute dollars with TTM (Trailing-Twelve-Months) operating cash flow of ~C$6.7B and free cash flow of ~C$4.7B. Free cash flow still covers a meaningful portion of profits (TTM free cash flow is ~70% of net income), but the trajectory has softened (TTM free cash flow growth provided at ~-1.7%) versus the exceptionally strong 2022 cash year. Cash flow quality looks improved versus 2023–2024 based on the provided coverage metric (TTM ~1.38 vs. 2024 ~0.85 and 2023 ~0.57), but overall results remain tied to the commodity cycle.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	47.08B	51.51B	50.90B	59.51B	37.51B
Gross Profit	9.99B	9.20B	9.22B	12.19B	6.09B
EBITDA	6.83B	8.24B	8.27B	11.28B	5.23B
Net Income	3.27B	4.79B	4.89B	7.34B	2.48B
Balance Sheet
Total Assets	42.31B	42.94B	41.20B	43.52B	40.78B
Cash, Cash Equivalents and Short-Term Investments	1.14B	979.00M	864.00M	3.75B	2.15B
Total Debt	4.38B	4.16B	4.33B	4.43B	5.42B
Total Liabilities	20.05B	19.46B	18.98B	21.11B	19.05B
Stockholders Equity	22.25B	23.47B	22.22B	22.41B	21.73B
Cash Flow
Free Cash Flow	4.70B	4.11B	1.95B	8.96B	4.37B
Operating Cash Flow	6.71B	5.98B	3.73B	10.48B	5.48B
Investing Cash Flow	-1.89B	-1.82B	-1.69B	-618.00M	-1.01B
Financing Cash Flow	-4.65B	-4.04B	-4.92B	-8.27B	-3.08B

Imperial Oil Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 159.03
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:IMO, the sentiment is Positive. The current price of 159.03 is above the 20-day moving average (MA) of 153.57, above the 50-day MA of 136.97, and above the 200-day MA of 122.53, indicating a bullish trend. The MACD of 7.56 indicates Positive momentum. The RSI at 58.79 is Neutral, neither overbought nor oversold. The STOCH value of 49.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:IMO.

Imperial Oil Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CNQ	81 Outperform	C$121.55B	18.39	16.17%	5.23%	8.06%	-10.64%
SU	77 Outperform	C$91.27B	15.80	13.25%	3.91%	-3.08%	-31.48%
IMO	75 Outperform	$76.52B	24.40	14.30%	2.45%	-6.18%	-14.06%
CCO	70 Outperform	$72.24B	122.52	8.94%	0.19%	23.88%	350.69%
CVE	70 Outperform	C$57.67B	14.15	12.88%	3.40%	-9.17%	-12.97%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
TRP	65 Neutral	$90.46B	26.58	13.64%	4.41%	-3.98%	-33.45%