Canadian Natural Resources (TSE:CNQ) Is Experiencing Growth In Returns On Capital

Simply Wall St.11-29 18:43

If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and ...

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Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and ...</p>\n\n<a href=\"https://finance.yahoo.com/news/canadian-natural-resources-tse-cnq-104347788.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Canadian Natural Resources (TSE:CNQ) Is Experiencing Growth In Returns On Capital</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nCanadian Natural Resources (TSE:CNQ) Is Experiencing Growth In Returns On Capital\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-29 18:43 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/canadian-natural-resources-tse-cnq-104347788.html><strong>Simply Wall St.</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and ...</p>\n\n<a href=\"https://finance.yahoo.com/news/canadian-natural-resources-tse-cnq-104347788.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"CNQ","symbol_name":"加国自然资源","start_time":0,"source_url":"https://finance.yahoo.com/news/canadian-natural-resources-tse-cnq-104347788.html","article_id":"2487532901","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/YbZfB0swF4KwgBIHqqdycQ--~B/aD00MzI7dz0xMTk0O2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/simply_wall_st__316/da713992716ec87035eff27f58858a3e"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2487532901","pubTimestamp":1732877027,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Firstly, we'll want to see a proven return on capital employed  that is increasing, and secondly, an expanding base of capital employed. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. Speaking of which, we noticed some great changes in Canadian Natural Resources'  returns on capital, so let's have a look.If you haven't worked with ROCE before, it measures the 'return'  a company generates from capital employed in its business. Analysts use this formula to calculate it for Canadian Natural Resources:. Return on Capital Employed = Earnings Before Interest and Tax  ÷ . Thus, Canadian Natural Resources has an ROCE of 15%.  On its own, that's a standard return, however it's much better than the 9.0% generated by the Oil and Gas industry.See our latest analysis for Canadian Natural Resources. Whi","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"CNQ":"加国自然资源","LU0300736492.USD":"FRANKLIN NATURAL RESOURCES \"A\" (USD) INC","LU1169589451.USD":"ALLSPRING (LUX)  U.S. SELECT EQUITY \"A\" (USD) ACC","BK4213":"石油与天然气的勘探与生产","BK4566":"资本集团","LU0300736062.USD":"FRANKLIN NATURAL RESOURCES \"A\" (USD) ACC","LU0368265418.SGD":"Blackrock World Energy Fund A2 SGD-H","LU0122376428.USD":"贝莱德世界能源基金A2","TSE":"Trinseo","EBIT":"Harbor AlphaEdge Small Cap Earners ETF","BK4090":"商品化工","LU1169590202.USD":"ALLSPRING (LUX)  U.S. SELECT EQUITY \"I\" (USD) ACC"},"translate_title":"加拿大自然资源公司（TSE：CNQ）的资本回报率正在增长","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"CNQ":1,"EBIT":1,"TSE":1},"content_text":"If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and secondly, an expanding base of capital employed. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. Speaking of which, we noticed some great changes in Canadian Natural Resources' (TSE:CNQ) returns on capital, so let's have a look. \n Understanding Return On Capital Employed (ROCE) \n If you haven't worked with ROCE before, it measures the 'return' (pre-tax profit) a company generates from capital employed in its business. Analysts use this formula to calculate it for Canadian Natural Resources: \n Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) \n0.15 = CA$9.9b ÷ (CA$75b - CA$8.0b) (Based on the trailing twelve months to September 2024).\n Thus, Canadian Natural Resources has an ROCE of 15%.  On its own, that's a standard return, however it's much better than the 9.0% generated by the Oil and Gas industry. \n See our latest analysis for Canadian Natural Resources \n\n\n\n  TSX:CNQ Return on Capital Employed November 29th 2024\n \n\n Above you can see how the current ROCE for Canadian Natural Resources compares to its prior returns on capital, but there's only so much you can tell from the past. If you're interested, you can view the analysts predictions in our free analyst report for Canadian Natural Resources . \n So How Is Canadian Natural Resources' ROCE Trending? \n Canadian Natural Resources' ROCE growth is quite impressive. The figures show that over the last five years, ROCE has grown 135% whilst employing roughly the same amount of capital. So our take on this is that the business has increased efficiencies to generate these higher returns, all the while not needing to make any additional investments. The company is doing well in that sense, and it's worth investigating what the management team has planned for long term growth prospects. \n The Bottom Line On Canadian Natural Resources' ROCE \n As discussed above, Canadian Natural Resources appears to be getting more proficient at generating returns since capital employed has remained flat but earnings (before interest and tax) are up. Since the stock has returned a staggering 242% to shareholders over the last five years, it looks like investors are recognizing these changes. So given the stock has proven it has promising trends, it's worth researching the company further to see if these trends are likely to persist. \n While Canadian Natural Resources looks impressive, no company is worth an infinite price. The  intrinsic value infographic for CNQ helps visualize whether it is currently trading for a fair price. \n While Canadian Natural Resources isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets. \nHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.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. 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