Canadian Natural Resources: A Stock on Shaky Ground

Canadian Natural Resources (TSE:CNQ) has just crossed a key technical threshold, but don’t be fooled - this is not a cause for celebration. The company’s stock price has recently surpassed its 200-day moving average, a significant technical indicator that often precedes a downturn. And to make matters worse, insiders are selling, not buying.

The stock price has been on a wild ride, fluctuating between a 52-week high of 52.15 CAD and a low of 34.92 CAD. But the current price of 43.57 CAD is not a reason to get excited. With a price-to-earnings ratio of 12.2 and a price-to-book ratio of 2.25, the company’s valuation is looking increasingly stretched.

Here are the cold, hard facts:

• Insider selling activity is on the rise, with key executives and directors offloading their shares at a rapid pace.
• The stock price has just crossed a key technical threshold, often a sign of a impending downturn.
• The company’s valuation is looking increasingly stretched, with a price-to-earnings ratio of 12.2 and a price-to-book ratio of 2.25.

Don’t be fooled by the company’s recent technical breakthrough. Canadian Natural Resources is a stock on shaky ground, and investors would do well to exercise caution.