Eric Nuttall’s Top Picks for Sept. 8, 2026

Eric Nuttall, Partner & Sr Portfolio Manager, Ninepoint Partners

Focus: Energy stocks

Top Picks: Cenovus, Strathcona, Suncor

MARKET OUTLOOK:

Our base case for the past seven months is that Iran has realized that control of the Strait of Hormuz, once the outlet for approximately 20 million barrels per day (MM Bbl/d) of oil and refined products, gives them more strategic power and influence than possession of a nuclear weapon.

The Islamic Revolutionary Guard Corps (IRGC) has no electoral cycle, and with a deeply unpopular war, an unpopular President, and with 56 days until the U.S. mid-term election, the pressure is mounting on U.S. President Trump day by day by day, as diesel is now trading at a record high of approximately US$250 per barrel (bbl), the average U.S. gasoline price is over US$4 per gallon, and the inflationary impact is being felt in interest rates with the U.S. 10-year now at 4.8 per cent making any interest rate cut challenging. No one knows how this conflict will end, and for now global inventories continue to draw, emergency stockpiles like the U.S. Strategic Petroleum Reserve (SPR) sit at their lowest level since 1983, and refineries continue to get hit, whether in Saudi Arabia or Russia, putting even more pressure on refined product prices like diesel and jet fuel. We remain in very dangerous territory.

For energy investors, we continue to advise on investing in “the day after”: what do things look like when the situation eventually ends? We see a higher price floor of at least US$70 West Texas Intermediate (WTI), the need to restock depleted inventories (approximately 450,000Bbl/d of new demand for the next three plus years), and a likely shift in the axis of power from the Middle East to North America with a renewed focus on “security of supply.” Canada has what the world wants and needs, Canadian energy stocks have continued to outperform globally, and “we remain bullish” on the outlook even after a very strong year so far.

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TOP PICKS:

Cenovus (CVE TSX)

The tightest part of the oil market is not crude oil but refined products, and Cenovus gives you excellent refining exposure with over 450,000Bbl/d of refining capacity along with now approximately one million barrels of oil equivalent per day (MM boe/d) of upstream production. The great thing is that even after a strong year so far with the stock up 93 per cent we think the stock is only discounting approximately $55WTI so in a “day after” scenario where oil falls to a floor of approximately $70 WTI we still see meaningful upside of approximately 33 per cent to $59 per share and if we are being too conservative and oil averages $80WTI we see 50 per cent upside to $66 per share.

Strathcona (SCR TSX)

Strathcona has what everyone wants: deep asset base with 50+ years of stay flat inventory, adequate and growing export egress with the new one MM Bbl/d West Coast pipeline and 550,000 Bbl/d, Bridger and Prairie connector pipeline online in the next eght and four years, attractive production growth of approximately 10 per cent per year, incremental free cashflow equivalent to a five to 10 per cent special dividend at $70 and $80 WTI, and meaningful leverage to an oil price above our $70 WTI floor price for 2027. We think the stock should trade at eight times enterprise value to free cash flow (EV/CF), equal 28 to 68 per cent potential upside at $70 WTI to $80 WTI.

Suncor (SU TSX)

Suncor is trading at a Canadian midcap or U.S. large cap multiple despite superior fundamentals. They have a very deep resource base, are the least exposed large cap to a widening WCS differential, excellent refining exposure, 100 per cent return of capital of free cashflow able to buy back 23 to 33 per cent of their shares outstanding over the next five years at $70 to $80 WTI. We think the stock should trade at eight times equal 31 per cent upside to $122 per share at $70 WTI and 49 per cent upside to $139 per share at $80 WTI.

PAST PICKS: NOV. 17, 2025

Whitecap Resources (WCP TSX)

Then: $11.12

Now: $18.35

Return: 65%

Total Return: 71%

Expand Energy (EXE NASDAQ)

Then: US$116.98

Now: US$97.04

Return: -17%

Total Return: -16%

Antero Resources (AR NYSE)

Then: US$33.64

Now: US$39.39

Return: 17%

Total Return: 17%

Total Return Average: 24%