The S&P/TSX Composite Index climbed 119 points on Friday, October 28. Meanwhile, the S&P/TSX Capped Energy Index rose marginally in the same trading session. Today, I want to discuss why Imperial Oil (TSX:IMO)(NYSE:IMO), one of the top energy stocks on the TSX, surged to close out this month.
Imperial Oil is a Calgary-based company that is engaged in the exploration, production, and sale of crude oil and natural gas in Canada. The company released its third quarter fiscal 2022 results on October 28. This sparked a huge spike for the stock in response.
This company reported upstream production of 430,000 gross oil-equivalent barrels per day. Meanwhile, it posted strong Downstream operating performance with quarterly refinery capacity utilization of 100%. It reported net income of $2.03 billion in the third quarter of fiscal 2022 – up from $908 million in the previous year. Moreover, net income was reported at $5.61 billion in the first nine months of the fiscal year. That was up from $1.66 billion in the year-to-date period in fiscal 2021.
Energy stocks like Imperial Oil gave gained a second wind in 2022 due to higher oil and gas prices. OPEC vowed to pursue production cuts earlier this fall, which sparked renewed optimism for equities in this space. Moreover, crude supplies have remained tight due to the ongoing war between Ukraine and Russia. Benchmark oil prices are still up sharply in the year-over-year period.
Shares of Imperial Oil have now climbed 23% month-over-month as of close on October 28. The stock is up 56% in the year-to-date period. Imperial Oil still possesses an attractive price-to-earnings ratio of 9.4. Moreover, it hiked its quarterly dividend to $0.44 per share.
