Canada’s energy sector is currently undergoing a massive wave of consolidation, as the largest players acquire smaller players to gain synergy benefits and streamline their operations. This marks a new era of capital discipline, with dividend policies becoming more generous and share buybacks a standard feature as the sector balances output growth with shareholder returns.
Holding investment positions “forever” is one of the most effective ways to maximize the tax efficiency of your portfolio. No capital gains tax will be levied. Holding on to the high-quality dividend payers also gives you enough time for the payouts to grow, which in turn increases the passive income potential of your portfolio. This long-term approach could ultimately leave your heirs with significant wealth, as well as dividends comparable to the initial investment.
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Buy Canadian Natural Resources Stocks for Multi-Decade Consistency
If you’re looking for a ‘forever’ stock, Canadian natural resources (TSX:CNQ) stands out for its legendary commitment to shareholder returns. Currently, the $122.1 billion oil and gas giant is committed to dedicating 60% of its free cash flow from growing production to shareholder returns, including dividends and share buybacks. The liability increases to 100% of free cash flow once net debt falls from $17.2 billion to $12 billion. This could take three to five years, but higher oil prices could shorten the time to this lucrative goal, enriching shareholders.
What makes Canadian natural resources a forever investment? The resilience of energy stocks’ operating profits and financial strength is rooted in a diversified asset base that includes low-cost, low-drip oilsands assets that continue to thrive through commodity price cycles. These geographically extensive operations generate the consistent free cash flow needed to fund rising quarterly dividends.
CNQ has built an incredible reputation for dividend growth with 25 consecutive years of dividend increases. Over the past quarter century, CNQ stock dividends have grown at a compound annual growth rate (CAGR) of over 21%. If you invested $2,500 in CNQ stock 25 years ago at a split price of about $2.70, your 926 shares would receive $2,176.10 in total dividends this year – a huge 87% return on the initial investment cost. CNQ had four stock splits during the period.
The dividend yield could be higher if CNQ raises 2026 dividends during an earnings event early next month.
CNQ data Ygraphs
A $2,500 investment in Canadian Natural Resources stocks 25 years ago could have grown into a $99,000 investment today. If the dividends had been fully reinvested, the portfolio could have grown past the capital gains limit of $52,680. This is a hypothetical example showing that long-term investment returns can be insanely high for patient stock pickers.
Future returns will vary, but a new investment in the high-quality CNQ stock today could deliver a 4% dividend yield, with growth likely to start next month.
Suncor Energy Stock
Suncor Energy (TSX:SU) stock is another essential candidate for a long-term energy portfolio. Unlike pure oil and gas producers, Suncor is an integrated giant, encompassing oil sands development, offshore production, oil refining and a vast network of 1,800 retail and wholesale networks, including Petro-Canada stations. Suncor’s broad integration allows the company to create value at every stage of the energy lifecycle, with minimal exposure to new U.S. tariffs.
The company recently reported its strongest operating year in history, achieving record upstream production and refinery throughput. Suncor shares its profits with shareholders through dividends and share buybacks. The current quarterly dividend of $0.60 per share should yield 3.2% annually. With a dividend payout ratio of about 48%, Suncor has enough cash left over to continue reducing debt and financing buybacks, while rewarding patient investors.
A $2,500 investment in Suncor stock 25 years ago would have grown into a $34,400 position over the past 25 years, with full dividend reinvestment. Based on a split-adjusted price of $9.30, the 2026 dividend could yield 25.8% for investors who have owned the stock since 2001.
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