Imperial Oil (IMO) AI Stock Analysis

• Market Cap: C$74.99B
• Dividend Yield: 2.45%
• Average Volume (3M): 828.88K
• Price to Earnings (P/E): 23.3
• Beta (1Y): 1.13
• 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: 496,861,020
• 10 Day Avg. Volume: 941,292
• 30 Day Avg. Volume: 828,884
• PEG Ratio: 1.54
• Price to Book (P/B): 2.00
• Price to Sales (P/S): 0.91
• P/FCF Ratio: 11.40
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$117.99
• Price Target Upside: -20.54% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 8
• EPS Forecast (FY): 6.72
• Revenue Forecast (FY): C$49.86B

• Rating: 72 Outperform
• Price Target: C$162.00 ▲(9.10% Upside)

Imperial Oil's overall stock score is driven by strong financial performance and positive earnings call highlights, including record production and strategic restructuring plans. However, technical indicators suggest potential short-term bearish momentum, and recent revenue declines and restructuring charges present some risks.

Positive Factors

Balance Sheet Strength

A low debt-to-equity ratio of 0.17 and a 19.47% ROE indicate conservative leverage and efficient equity use. This durable financial footing supports capital allocation flexibility, resilience to commodity cycles, and ability to fund upstream projects or return capital without stressing liquidity over the next 2–6 months.

Cash Generation & Returns

Sustained operating cash flow near $1.8B and equivalent capital returned to shareholders demonstrate strong cash conversion and disciplined capital deployment. This persistent cash generation underpins dividends, buybacks, and reinvestment capacity, strengthening long-term shareholder support and financial flexibility.

Restructuring Targeting Cost Cuts

A formal restructuring targeting $150M in annual savings by 2028 is a structural efficiency initiative. If executed, it will lower the company's cost base, improve operating margins, and enhance cash flow resiliency across commodity cycles, supporting sustainable earnings improvement over multiple years.

Negative Factors

Revenue Trend Decline

A multi-period revenue decline (3.20% TTM) signals a potential structural headwind from lower realizations, product mix shifts, or downstream market pressure. If persistent, declining top-line can compress margins, limit reinvestment, and reduce the buffer for cyclical downturns over the medium term.

Restructuring & Impairment Charges

Large restructuring ($330M) and noncash impairment ($406M) materially reduced reported earnings and reflect asset reconfiguration costs. Such charges can indicate prior overinvestment or portfolio shifts, reduce near-term earnings power, and create execution risk as savings must offset the one-time losses over subsequent quarters.

Chemical Segment Weakness

Declining chemical earnings and weaker polyethylene margins highlight structural pressure in petrochemicals. As petrochemical margins can be cyclical and capital intensive, sustained weakness would reduce segment diversification benefits and weigh on consolidated earnings and cash conversion in the medium term.

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

Imperial Oil demonstrates strong profitability with a solid gross profit margin and a robust balance sheet characterized by low leverage and high return on equity. However, the recent revenue decline and room for improvement in cash flow efficiency slightly temper the overall financial performance.

Income Statement

Imperial Oil's income statement reflects a strong gross profit margin of 18.45% and a net profit margin of 9.48% for the TTM, indicating solid profitability. However, the company experienced a revenue decline of 3.20% in the TTM, which could be a concern if the trend continues. The EBIT and EBITDA margins are healthy, showing efficient operations despite the revenue dip.

Balance Sheet

The balance sheet is robust with a low debt-to-equity ratio of 0.17, suggesting conservative leverage. Return on equity is strong at 19.47%, indicating effective use of equity to generate profits. The equity ratio is stable, reflecting a solid financial position with a good balance between assets and equity.

Cash Flow

Cash flow analysis shows a positive free cash flow growth of 6.53% in the TTM, demonstrating improved cash generation. The operating cash flow to net income ratio is close to 1, indicating good cash conversion from earnings. However, the free cash flow to net income ratio of 0.72 suggests room for improvement in cash flow efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	47.99B	51.51B	50.90B	59.51B	37.51B	22.28B
Gross Profit	8.15B	9.20B	9.22B	12.19B	6.09B	1.72B
EBITDA	7.69B	8.24B	8.27B	11.28B	5.23B	845.00M
Net Income	4.00B	4.79B	4.89B	7.34B	2.48B	-1.86B
Balance Sheet
Total Assets	30.85B	42.94B	41.20B	43.52B	40.78B	38.03B
Cash, Cash Equivalents and Short-Term Investments	1.34B	979.00M	864.00M	3.75B	2.15B	771.00M
Total Debt	3.03B	4.16B	4.33B	4.43B	5.42B	5.28B
Total Liabilities	13.84B	19.46B	18.98B	21.11B	19.05B	16.61B
Stockholders Equity	17.01B	23.47B	22.22B	22.41B	21.73B	21.42B
Cash Flow
Free Cash Flow	4.78B	4.11B	1.95B	8.96B	4.37B	-70.00M
Operating Cash Flow	6.58B	5.98B	3.73B	10.48B	5.48B	798.00M
Investing Cash Flow	-1.74B	-1.82B	-1.69B	-618.00M	-1.01B	-802.00M
Financing Cash Flow	-4.47B	-4.04B	-4.92B	-8.27B	-3.08B	-943.00M

Imperial Oil Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 148.49
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 148.49 is above the 20-day moving average (MA) of 138.21, above the 50-day MA of 130.32, and above the 200-day MA of 118.47, indicating a bullish trend. The MACD of 5.21 indicates Negative momentum. The RSI at 68.51 is Neutral, neither overbought nor oversold. The STOCH value of 86.74 is Negative, 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$109.68B	16.60	16.17%	5.23%	8.06%	-10.64%
SU	77 Outperform	C$86.49B	14.83	13.25%	3.91%	-3.08%	-31.48%
CVE	73 Outperform	$52.34B	16.02	10.65%	3.40%	-9.17%	-12.97%
IMO	72 Outperform	C$74.99B	23.28	14.30%	2.45%	-6.18%	-14.06%
TRP	70 Outperform	$84.31B	24.83	12.96%	4.41%	-3.98%	-33.45%
CCO	68 Neutral	$68.28B	129.79	7.96%	0.19%	23.88%	350.69%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%