Suncor Energy Inc (TSX:SU)(NYSE:SU) has been falling hard in recent weeks with the stock falling deep into oversold territory. With a Relative Strength Index (RSI) of around 18, this is the most the stock has been oversold all year. Close to its 52-week low of $35.53, the stock hasn’t been this low since December when the markets were in the midst of a big free-fall.
Coming off another strong quarter that saw the company post a big profit, there’s no stock-specific reason for Suncor’s share price to be down as much as it is. And with news that the Trans Mountain pipeline is allowed to resume construction, there’s actually reason to be bullish on oil and gas stocks.
This selloff is certainly market related and that could make it a great opportunity for investors to buy the stock and not only take advantage of a low price, but also of a dividend yield that’s now a lot higher as well.
Currently paying shareholders a yield of 4.6%, that’s a pretty high payout for one of the top dividend stocks on the TSX. Suncor is as stable a buy as you can find in oil and gas and with the stock down 11% in just the past month, it could be a great time to lock-in this price and yield.
Long term, Suncor is a safe buy and it’s very likely that the stock will recover from this low. With strong fundamentals, a great dividend and trading near its low, the stock is almost a must-buy at its current price.
