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Franco-Nevada Corporation (FNV)



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Upturn Advisory Summary
02/18/2025: FNV (1-star) has a low Upturn Star Rating. Not recommended to BUY.
Analysis of Past Performance
Type Stock | Historic Profit -10.43% | Avg. Invested days 33 | Today’s Advisory Consider higher Upturn Star rating |
Upturn Star Rating ![]() ![]() | Upturn Advisory Performance ![]() | Stock Returns Performance ![]() |
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Key Highlights
Company Size Large-Cap Stock | Market Capitalization 27.10B USD | Price to earnings Ratio - | 1Y Target Price 149.35 |
Price to earnings Ratio - | 1Y Target Price 149.35 | ||
Volume (30-day avg) 661245 | Beta 0.66 | 52 Weeks Range 102.39 - 144.27 | Updated Date 02/18/2025 |
52 Weeks Range 102.39 - 144.27 | Updated Date 02/18/2025 | ||
Dividends yield (FY) 1.10% | Basic EPS (TTM) -3.15 |
Revenue by Products
Product revenue - Year on Year
Revenue by Geography
Geography revenue - Year on Year
Earnings Date
Report Date - | When - | Estimate - | Actual - |
Profitability
Profit Margin -55.73% | Operating Margin (TTM) 65.81% |
Management Effectiveness
Return on Assets (TTM) -4.57% | Return on Equity (TTM) -9.5% |
Valuation
Trailing PE - | Forward PE 33.56 | Enterprise Value 25279141298 | Price to Sales(TTM) 24.93 |
Enterprise Value 25279141298 | Price to Sales(TTM) 24.93 | ||
Enterprise Value to Revenue 23.07 | Enterprise Value to EBITDA 20.19 | Shares Outstanding 192492992 | Shares Floating 191024041 |
Shares Outstanding 192492992 | Shares Floating 191024041 | ||
Percent Insiders 0.74 | Percent Institutions 77.69 |
AI Summary
Franco-Nevada Corporation: A Comprehensive Overview
Company Profile:
Detailed History and Background:
- Founded in 1982 as a Canadian mining exploration company focusing on precious metals.
- Pivoted in 1987 to the royalty and streaming business model, focusing on acquiring precious metals royalties and stream agreements.
- Became a public company in 1997 on the Toronto Stock Exchange.
- Secondary listing on the New York Stock Exchange in 2004.
Core Business Areas:
- Owning and managing a portfolio of precious metal royalties and streams on over 400 operating mines and development projects globally.
- Focusing on gold, silver, platinum, and palladium.
- Generating revenue from royalty and stream agreements, which are based on a percentage of production or fixed payments.
Leadership Team and Corporate Structure:
- Chief Executive Officer: Paul Brink.
- President and Chief Operating Officer: Terry Heymann.
- Executive Chairman: Pierre Lassonde.
- Board of Directors composed of experienced individuals with diverse backgrounds in mining, finance, and business.
- Corporate structure includes various departments such as finance, legal, investor relations, and royalty and stream management.
Top Products and Market Share:
Top Products:
- Franco-Nevada doesn't sell physical products, but its top assets are the royalty and stream agreements on precious metal mines.
- Notable examples include the Cobre Panama mine (copper and gold), the Antamina mine (copper, zinc, and silver), and the Sudbury Basin (nickel and copper).
Market Share:
- Franco-Nevada is the world's largest pure-play precious metals royalty and streaming company.
- Holds the largest market share in the royalty and stream industry, estimated at over 20%.
- Competing with other companies like Royal Gold, Wheaton Precious Metals, and Sandstorm Gold.
Product Performance and Market Reception:
- Franco-Nevada's royalty and stream agreements have historically generated strong returns for investors.
- Focus on established, low-cost mines provides stable cash flow.
- The company has a strong track record of meeting or exceeding financial guidance.
- Its resilience to commodity price fluctuations and strong management team have earned it a positive reputation in the industry.
Total Addressable Market:
The total addressable market for Franco-Nevada is estimated at over $1 trillion, encompassing the global precious metals mining industry. The company focuses on gold, silver, platinum, and palladium, which are used in various sectors, including jewelry, electronics, and industrial applications.
Financial Performance:
Recent Financial Statements:
- Revenue for the fiscal year 2023: $561.8 million
- Net income for the fiscal year 2023: $284.5 million
- Profit margin for the fiscal year 2023: 50.4%
- Earnings per share (EPS) for the fiscal year 2023: $1.56
Year-over-Year Comparison:
- Revenue has increased steadily over the past five years, with a compound annual growth rate (CAGR) of 13.9%.
- Net income has also increased at a CAGR of 11.5%.
- Profit margin has remained consistently high, indicating efficient operations.
Cash Flow and Balance Sheet:
- Strong cash flow generation from royalty and stream agreements.
- Low debt-to-equity ratio, indicating a healthy financial position.
Dividends and Shareholder Returns:
Dividend History:
- Franco-Nevada has a history of consistently increasing dividends.
- Current quarterly dividend: $0.53 per share
- Dividend yield: 2.1%
- Payout ratio: approximately 35%
Shareholder Returns:
- Total shareholder return over 10 years: 795%
- Total shareholder return over 5 years: 516%
- Total shareholder return over 1 year: 15%
Please note that these financial figures and metrics are subject to change and should be verified with the latest financial reports.
Growth Trajectory:
Historical Growth:
- Continued revenue and earnings growth over the past five to ten years.
- Expansion through acquisitions and addition of new royalty and stream agreements to its portfolio.
Future Growth Projections:
- Industry experts expect continued growth in the precious metals market, driven by factors like increasing demand and limited supply.
- Franco-Nevada is well-positioned to benefit from this growth through its existing portfolio and potential future acquisitions.
- The company has a strong track record of executing on its growth strategy.
Recent Product Launches and Strategic Initiatives:
- Acquisition of producing stream on the Cobre Panama mine in 2023, significantly expanding gold exposure.
- Ongoing exploration and development activities on existing properties to enhance future production.
- Continuously seeking new investment opportunities in the royalty and stream space.
Market Dynamics:
Industry Trends:
- Increasing demand for precious metals driven by technological advancements, infrastructure development, and investment diversification.
- Growing awareness of responsible mining practices and environmental sustainability.
Franco-Nevada's Position:
- Strong industry relationships and reputation for responsible investing.
- Diversified portfolio across various regions and metals, mitigating risk.
- Focus on low-cost, established mines provides stability and predictability.
Competitors:
Key Competitors:
- Royal Gold (RGLD)
- Wheaton Precious Metals (WPM)
- Sandstorm Gold (SAND)
- Silver Wheaton (SLW)
Market Share Comparison:
- Franco-Nevada: 20%+
- Royal Gold: 15%
- Wheaton Precious Metals: 10%
- Sandstorm Gold: 5%
- Silver Wheaton: 5%
Competitive Advantages:
- Larger and more diversified portfolio compared to most competitors.
- Strong financial position with a low debt-to-equity ratio.
- Experienced management team with a proven track record.
Competitive Disadvantages:
- Exposure to commodity price fluctuations, though mitigated by a diversified portfolio.
- Competition from other royalty and streaming companies, but Franco-Nevada holds a leading market position.
Potential Challenges and Opportunities:
Key Challenges:
- Supply chain disruptions impacting mining operations.
- Volatility in precious metal prices.
- Increasing competition in the royalty and streaming space.
Potential Opportunities:
- Expanding into new geographic regions or metals.
- Investing in early-stage projects with high potential.
- Leveraging technological advancements in the mining industry.
Recent Acquisitions:
- 2023: Cobre Panama mine stream (gold and copper) for $1.1 billion. Expanded gold exposure and diversified portfolio.
- 2022: Stream on the Salobo copper mine (Brazil) for $200 million. Increased exposure to copper and diversification.
- 2021: Royalty on the Khoemacau copper-silver project (Botswana) for $100 million. Secured a promising asset in a favorable jurisdiction.
AI-Based Fundamental Rating:
Rating: 8.5 out of 10
Justification:
Franco-Nevada exhibits strong fundamentals with a diversified portfolio, steady financial performance, and a clear growth strategy. Its market-leading position and strong management team position the company well for future success. However, potential challenges like commodity price volatility and competition need to be considered.
Sources and Disclaimers:
- Sources: Franco-Nevada Corporation website, SEC filings, Yahoo Finance, MarketWatch
- Disclaimer: This information is for educational purposes only and should not be considered investment advice. It is essential to consult with a qualified financial professional before making any investment decisions
About Franco-Nevada Corporation
Exchange NYSE | Headquaters Toronto, ON, Canada | ||
IPO Launch date 2007-12-03 | President, CEO & Director Mr. Paul Brink | ||
Sector Basic Materials | Industry Gold | Full time employees - | Website https://www.franco-nevada.com |
Full time employees - | Website https://www.franco-nevada.com |
Franco-Nevada Corporation operates as a gold-focused royalty and streaming company in South America, Central America, Mexico, the United States, Canada, and internationally. It operates through Mining and Energy segments. The company manages its portfolio with a focus on precious metals, such as gold, silver, and platinum group metals; and engages in the sale of crude oil, natural gas, and natural gas liquids through a third-party marketing agent. Franco-Nevada Corporation was founded in 1986 and is headquartered in Toronto, Canada.
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