One-glance verdict
Overvalued
$72.46 our estimate vs market $261.89
Wall Street consensus: $286.97 (296.0% higher than our fair-value estimate)
261% above our estimate, beyond the bull case
Fundamentals snapshot
Franco-Nevada Corporation
FNV · NYQ · Basic Materials · Gold
Current price
$261.89
52-week range
$181.50 - $285.67
Market cap
$50.51B
Balance sheet
Healthy
4,336.33x Strong cushion
Net cash $1.01B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
0 Risks
3 rewards · 0 risks
- Reward Revenue grew 63.7% last year.
- Reward Returns 19.9% on equity, ahead of 33% of its peers.
- Reward Free cash flow was positive in 3/10 years.
What this company does
Franco-Nevada Corporation
Franco-Nevada is a unique company that invests in mines without actually digging anything themselves. They provide cash to mining companies in exchange for either a royalty (a small percentage of the mine's future sales) or the right to buy metals from them at a fixed, low price. This business model allows them to make money primarily on precious metals like gold, as well as on oil and gas, while avoiding the massive direct costs and risks of operating a mine.
How the company got here
Franco-Nevada started in 1983 with a new idea for the gold industry borrowed from the oil and gas business. Instead of digging for gold themselves, they provided cash to other miners in exchange for a small piece of the mine's future sales, an arrangement called a royalty. This new model was very successful, and in 2002, a large mining company called Newmont bought them. Five years later, in 2007, the original leadership team bought back the portfolio of royalties from Newmont and took the new Franco-Nevada public through an Initial Public Offering (an IPO, which is the first time a company sells its stock to the general public).
What it actually does
Think of Franco-Nevada as a special kind of financing partner for mining and energy companies, not a company that operates its own mines or drills for oil. It gives these companies cash upfront to help them build or expand their projects. In return, Franco-Nevada gets the right to receive a small share of the mine's future revenue or the ability to buy some of its future production at a very low, fixed price. This business model allows them to profit from the sale of gold, silver, and oil without being exposed to the direct risks and high costs of actually running a mine, like managing workers or buying heavy equipment.
Precious Metals
This is the company's largest and most important business, focused mainly on gold, silver, and platinum. Franco-Nevada makes money here in two main ways: through royalties (where they get a percentage of the revenue from a mine's sales) and streams (where they have a contract to buy a certain amount of a mine's future metal production at a deep discount). For example, they might give a copper mining company cash to build a mine and, in return, get the right to buy all the gold that's produced as a byproduct for a very low price. This segment provides the majority of the company's revenue.
Other Mining
To avoid having all their eggs in one basket, Franco-Nevada also invests in mines that produce other materials, such as copper and other industrial metals. This is a smaller part of their business but adds to their diversification (spreading investments across different assets to reduce risk). The deals are structured similarly to their precious metals agreements, using royalties and streams. This part of the business helps provide stable cash flow even if precious metal prices are down.
Energy
Similar to its mining business, Franco-Nevada also owns royalty interests in oil and natural gas properties, primarily in the United States. This means they receive a portion of the sales when oil or gas is produced and sold from land they have an interest in. They don't do any drilling or exploration themselves. This energy segment provides an important source of revenue that is separate from their mining investments, further diversifying the company's income.
What management is betting on now
Management's main focus is to keep growing its portfolio by making more royalty and streaming deals across different commodities and geographic locations. They aim to be the go-to gold investment for people who want exposure to rising gold prices but with less risk than owning a traditional mining stock. A key part of their strategy is to maintain a strong balance sheet (a snapshot of the company's financial health, showing what it owns and what it owes) so they always have cash ready for new opportunities. They also prioritize paying a dividend (a regular payment made to people who own the company's stock), and have increased it every year for over a decade.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $72.46 vs current price $261.89
Wall Street consensus is the average analyst price target: $286.97 (296.0% higher than our fair-value estimate).
Our most-likely fair value is $72.46 a share — about 72.3% below today's price of $261.89, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Healthy
Net cash $1.0B - more cash than debt. Interest coverage 4336.3x.
Net debt
$-1.01B
Interest coverage
4,336.33x
Franco-Nevada Corporation's profit covers its interest bill about 4336.3 times over. which is stronger than every peer shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
FNV
BASELINE
Franco-Nevada Corporation
Total debt $0.00 Interest coverage 4,336.33x This is the baseline the peer rows are being compared against.
Total debt $1.98B Interest coverage 3,686.81x -15% vs FNV Has roughly the same debt cushion as FNV.
Total debt $395.89M Interest coverage 22.90x -99% vs FNV Carries about 189.3x less debt cushion than FNV.
Total debt $219.28M Interest coverage 45.20x -99% vs FNV Carries about 95.9x less debt cushion than FNV.
Total debt $236.19M Interest coverage 51.34x -99% vs FNV Carries about 84.5x less debt cushion than FNV.
Total debt $14.66M Interest coverage -0.04x -100% vs FNV This peer has almost no interest-payment cushion compared with FNV.
What you should know
The case for and against FNV
3 Rewards
0 Risks
Rewards
-
Revenue grew 63.7% last year.
-
Returns 19.9% on equity, ahead of 33% of its peers.
-
Free cash flow was positive in 3/10 years.
Risks
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
34.19x
Forward P/E
27.99x
P/B
6.13x
P/S
21.95x
EV/EBITDA
24.09x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
92.1%
Operating margin
77.0%
Net margin
64.2%
ROE
19.9%
ROA
13.7%
Health
Liquidity and balance-sheet strength
Debt / equity
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Current ratio
9.38x
Quick ratio
8.60x
Total debt
$0.00
Total cash
$1.01B
Growth
How the business has been compounding
Revenue TTM
$2.30B
Revenue 5Y CAGR
11.5%
EPS TTM
7.66
EPS 5Y CAGR
16.4%
Cash flow
How much cash the business throws off
Operating CF TTM
$1.49B
Free CF TTM
$-703.00M
FCF margin
-30.6%
Dividend
Shareholder payout
Yield
0.7%
Payout ratio
21.4%
Last ex-div date
2026-09-10