Imperial Oil (TSE:IMO)
TSX:IMO
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Imperial Oil
(TSX:IMO)
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Rating:75Outperform
Price Target:
C$203.00
â–²(13.45% Upside)
Action:ReiteratedDate:03/26/26
The score is driven primarily by strong underlying financial resilience (low leverage and meaningful free cash flow) and a constructive earnings outlook focused on cost reductions, production ramps, and outsized shareholder returns. This is tempered by cyclical normalization in revenue/margins, stretched technical momentum (overbought signals), and a valuation that looks only moderate for a commodity-sensitive business.
Positive Factors
Balance-sheet strength
Imperial’s low debt-to-equity (~0.18) and sizable equity base provide durable financial flexibility. This capital structure reduces refinancing and solvency risk across cycles, supports sustained dividends, buybacks and targeted capex, and preserves optionality to fund growth or weather downturns.
Negative Factors
Commodity-cycle sensitivity
Imperial’s earnings and margins remain materially tied to commodity prices and downstream spreads. The recent normalization—revenue and margin compression versus 2022 peaks—means cash flows and returns can swing significantly with oil/gas cycles, complicating multi-quarter planning and making long-term profit sustainability contingent on favorable commodity dynamics.
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Positive Factors
Negative Factors
Balance-sheet strength
Imperial’s low debt-to-equity (~0.18) and sizable equity base provide durable financial flexibility. This capital structure reduces refinancing and solvency risk across cycles, supports sustained dividends, buybacks and targeted capex, and preserves optionality to fund growth or weather downturns.
Read all positive factors
Imperial Oil (IMO) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$86.53B
Dividend Yield2.45%
Average Volume (3M)882.76K
Price to Earnings (P/E)18.3
Beta (1Y)0.90
Revenue Growth-6.18%
EPS Growth-14.06%
CountryCA
Employees5,100
SectorEnergy
Sector Strength52
IndustryOil & Gas Integrated
Share Statistics
EPS (TTM)1.97
Shares Outstanding483,592,700
10 Day Avg. Volume730,348
30 Day Avg. Volume882,761
Financial Highlights & Ratios
PEG Ratio-0.65
Price to Book (P/B)2.68
Price to Sales (P/S)1.27
P/FCF Ratio12.70
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$141.92Price Target Upside-20.69% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering10
EPS Forecast (FY)11.02
Revenue Forecast (FY)C$53.28B
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 crud...
How the Company Makes Money
Imperial Oil primarily makes money by producing hydrocarbons and selling energy and refined products across multiple segments of the value chain. (1) Upstream revenue: Imperial earns revenue from the sale of crude oil, bitumen, and natural gas pro...
Imperial Oil Earnings Call Summary
Earnings Call Date:Jan 30, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 01, 2026
Earnings Call Sentiment Positive
The call presented a predominantly positive picture: strong cash generation, heavy shareholder returns (large buybacks and the largest nominal dividend increase in company history), record annual production and downstream resilience. These positives were tempered by several one-time charges (Norman Wells cessation, inventory write-down), weather-related disruption at Kearl that reduced Q4 production, and lower upstream realizations that weighed on quarterly net income. Management emphasized confidence in its cost-reduction programs, production ramp plans (e.g., Leming, Mahihkan) and the restructuring savings trajectory, supporting a constructive outlook despite the near-term operational and one-time financial hits.Positive Updates
Strong cash flow generation
Generated $1.918 billion in cash flow from operations in Q4 and $6.7 billion for full-year 2025; produced nearly $1.4 billion of free cash flow in Q4 (WTI < $60) and ~$4.8 billion free cash flow for 2025.
Negative Updates
One-time charges: Norman Wells cessation
Announced decision to cease production at Norman Wells by end of Q3 2026, resulting in a one-time after-tax charge of $320 million (includes $108 million impairment and $212 million of related contractual obligations).
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Q4-2025 Updates
Positive
Negative
Strong cash flow generation
Generated $1.918 billion in cash flow from operations in Q4 and $6.7 billion for full-year 2025; produced nearly $1.4 billion of free cash flow in Q4 (WTI < $60) and ~$4.8 billion free cash flow for 2025.
Read all positive updates
Company Guidance
Management framed 2026 guidance around growing volumes, lowering unit costs and continuing strong shareholder returns: upstream production momentum targets Kearl at 285–295 kbpd this year (path to 300 kbpd), Cold Lake averaging 153 kbpd in Q4 with Leming ~4 kbpd today ramping toward ~9 kbpd in 2026 and a Mahihkan SA‑SAGD start in 2029 targeting 30 kbpd; Syncrude contribution ~87 kbpd. Unit‑cost targets are Kearl ~US$18/bbl (2025 full year US$19.50; Q4 US$23.84 incl. ~US$4.50 inventory hit) and Cold Lake US$13/bbl by 2027 (2025 full year US$14.67; Q4 US$16 incl. ~US$1 hit). Capital and cash priorities remain steady with 2025 CapEx of $2.0B (Q4 $651M; upstream Q4 $508M), refinery throughput ~402 kbpd for 2025 (Q4 408 kbpd, 94% utilization), continued NCIB activity, cash on hand >$1.1B, and a renewed emphasis on returns (declared quarterly dividend $0.87/share, +$0.15/~21% payable Apr 1, 2026; 2025 returns $4.6B total — $1.4B dividends, $3.2B buybacks — and ~34% shares repurchased since 2020) while targeting sustained free cash generation (2025 free cash flow ~ $4.8B; Q4 nearly $1.4B even with WTI <US$60) and announced restructuring savings of ~$150M/year by 2028.Imperial Oil Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
83
Very Positive
Cash Flow
74
Positive
| 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
Positive
178.93
Price Trends
165.07
Positive
146.97
Positive
133.15
Positive
Market Momentum
4.84
Positive
58.68
Neutral
49.77
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 178.93 is above the 20-day moving average (MA) of 177.02, above the 50-day MA of 165.07, and above the 200-day MA of 133.15, indicating a bullish trend. The MACD of 4.84 indicates Positive momentum. The RSI at 58.68 is Neutral, neither overbought nor oversold. The STOCH value of 49.77 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
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | C$133.84B | 8.98 | 25.98% | 5.23% | 8.06% | -10.64% | |
75 Outperform | C$86.53B | 18.28 | 14.75% | 2.45% | -6.18% | -14.06% | |
74 Outperform | C$105.98B | 12.55 | 13.17% | 3.91% | -3.08% | -31.48% | |
73 Outperform | C$67.43B | 10.69 | 13.16% | 3.40% | -9.17% | -12.97% | |
69 Neutral | C$92.03B | 22.34 | 12.80% | 4.41% | -3.98% | -33.45% | |
67 Neutral | C$69.99B | 92.81 | 8.76% | 0.19% | 23.88% | 350.69% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% |
* Energy Sector Average
TSE:IMO
Imperial Oil
178.93
94.68
112.37%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.