This yield looks more attractive in an environment where commodity prices appear to be finding a floor and investors are searching for the highest quality companies in each sector with the best balance sheets as a way to combat uncertainty.
Canadian Natural’s ability to grow its cash flows over time has provided a strong thesis for ownership and has resulted in a balance sheet that is among the best of its peers on a relative basis.
Because the company has so aggressively invested in its capital program in the past, current investors benefit from lower long-term capital needs moving forward and better projected cash flows, even in a relatively low commodity price environment.
Canadian Natural has some of the best operating and valuation metrics in the sector and is as defensive a name one can own in this space, making its dividend attractive in my view.