This report is an updated version of the report published on 18 November 2025, at 11:10 PM PDT.  

Canadian Natural Resources Limited (NYSE: CNQ) 

Canadian Natural Resources Limited is a crude oil and natural gas production company. Its exploration and production segment are focused on North America, in Western Canada, the United Kingdom portion of the North Sea, and Cote d'Ivoire in Offshore Africa.

Recommendation Rationale – SELL at USD 34.05

• Technical Standpoint: CNQ’s share price has surpassed the R1 level recommended on 20 August 2025. The 14-day RSI is now around 69.60, approaching overbought territory. This upward move raises the risk of short-term consolidation or downside retracement.
• Rising Production Costs: In Q3 FY25, production expenses increased to CAD 2,220 million, up from CAD 1,949 million in Q3 FY24, indicating higher operating cost intensity year-over-year.
• Significant Earnings Decline: Net earnings fell to CAD 600 million in Q3 FY25 compared with CAD 2,266 million in Q3 FY24, reflecting a steep drop in profitability.
• Overvalued Multiples: On a forward 12-month basis – key trading multiples (Price/ Cash Flow and Price/Earning) are higher than industry (Energy) average, hence looks overvalued.
• Market Risk: CNQ faces risks from volatile oil and gas prices, regulatory shifts, carbon compliance costs, operational disruptions, project delays, and geopolitical uncertainty that may impact margins and long-term production growth.

CNQ Daily Chart

Valuation Methodology: Price/Earning Approach (FY Dec'26E) (Illustrative)

The stock might trade at a slight premium to its peers considering the lift in product sales in Q3 FY25 to CAD 11,070 million from CAD 10,401 million in Q3 FY24, increase in cash flows from operating activities over the same period, and higher oil sands and crude oil/NGLs output in Q3 FY25, etc. For conducting the valuation, peers including ConocoPhillips (NYSE: COP), BP PLC (NYSE: BP), EOG Resources Inc (NYSE: EOG) and others have been considered.             

Given the stock is approaching to its R2 level, recent rally in the share price, and risks associated, it is prudent to sell the stock at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the closing market price of USD 34.05, as of 18 November 2025.

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical issues prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is neither an indicator nor a guarantee of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 18 November 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.

Note 5: Dividend Yield may vary as per the stock price movement.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices