One-glance verdict
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Fair value unavailable
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Fundamentals snapshot
Gold Royalty Corp.
GROY · ASE · Basic Materials · Gold
Current price
$3.17
52-week range
$2.45 - $5.46
Market cap
$737.61M
Balance sheet
Healthy
0.20x Concerning
Net cash $13.99M. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
0 Risks
2 rewards · 0 risks
View details ↓What this company does
Gold Royalty Corp.
Gold Royalty Corp. is a company that essentially acts like a lender to mining companies, but instead of getting cash back with interest, they get a percentage of the gold or other precious metals mined. This means their income is tied directly to how much precious metal is dug out of the ground, making their revenue (the money they make from sales) dependent on mining production rather than selling physical goods themselves. This business model is interesting because it can provide a steady stream of income if the mines they partner with are productive, similar to how a landlord receives rent from tenants.
How the company got here
Gold Royalty Corp. was founded in 2020 and is a relatively young company that has grown rapidly through acquisitions. It was incorporated in Canada and went public in 2021, acquiring Ely Gold Royalties in the same year. This acquisition was significant as it not only added assets but also brought in a royalty-generation model. The company's strategy has been to consolidate and build its portfolio through various transactions, rather than through slow, organic growth. This approach has shaped the company into its current form, blending acquired royalties with an internal system for creating new ones.
What it actually does
Gold Royalty Corp. doesn't mine for gold itself. Instead, it acts like a financier for mining companies. It buys a stake in a mine's future production, meaning it gets a percentage of the revenue or a set amount of gold once it's mined. Think of it like buying a small piece of a future payday from a mine. This allows the company to benefit from gold prices and mining success without the day-to-day hassle and costs of actually running a mine. They have a large portfolio, with over 250 royalties and streams, spread across different mines and stages of development.
Royalties
A royalty is essentially a contract that gives Gold Royalty the right to a portion of the revenue generated from a specific mine. This revenue is typically calculated after certain specified deductions, such as refining costs. It's like owning a small percentage of the sales from a mine's output. The company acquires these royalties on mines that are in various stages, from exploration to full production, aiming to create a diverse stream of income over time. Most of Gold Royalty's portfolio is made up of these net smelter return (NSR) royalties, which take a cut of revenue before mining costs are considered.
Streams
A stream is another way Gold Royalty makes money, and it's similar to a royalty but with a key difference. Instead of a percentage of revenue, a stream gives Gold Royalty the right to purchase a portion of the mine's actual metal production at a predetermined price. This price is usually lower than the market price, allowing Gold Royalty to profit from the difference. It's like having a special deal to buy a certain amount of gold at a discount, which you can then sell at the going market rate.
Advance Minimum and Other Royalties
Gold Royalty also earns income from advance minimum royalties, which are payments made before a mine is fully operational and producing significant revenue. Additionally, they generate income from land agreements, where they might lease out land they hold rights to, and from interest on gold-linked loans. These are smaller, but still important, ways the company diversifies its income streams beyond just the direct revenue from producing mines.
What management is betting on now
Gold Royalty's management is focused on growing the company's portfolio of royalties and streams. They aim to achieve this by acquiring more third-party royalties, financing new mine developments, and pursuing strategic mergers and acquisitions. A key part of their strategy is to generate new royalties internally through their own royalty generation operations. The goal is to increase the company's net asset value per share, which means making the company more valuable on a per-share basis for its investors, and to deliver long-term returns.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value — vs current price $3.17
We couldn't calculate a fair value right now.
Is it drowning in debt?
Healthy
Net cash $14.0M - more cash than debt. Interest coverage 0.2x.
Net debt
$-13.99M
Interest coverage
0.20x
Gold Royalty Corp.'s profit covers its interest bill about 0.2 times over. which is stronger than most peers 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
GROY
BASELINE
Gold Royalty Corp.
Total debt $151.00K Interest coverage 0.20x This is the baseline the peer rows are being compared against.
Total debt $219.28M Interest coverage 45.20x +21,955% vs GROY Carries about 220.5x more debt cushion than GROY.
Total debt $186.11M Interest coverage 51.34x +24,954% vs GROY Carries about 250.5x more debt cushion than GROY.
Total debt $14.66M Interest coverage -0.04x -100% vs GROY This peer has almost no interest-payment cushion compared with GROY.
What you should know
The case for and against GROY
2 Rewards
0 Risks
Rewards
-
Revenue grew 54.5% last year.
-
Returns 0.2% on equity, ahead of 25% of its peers.
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)
105.83x
Forward P/E
33.42x
P/B
1.02x
P/S
32.70x
EV/EBITDA
62.16x
PEG ratio
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Profitability
How much profit each dollar creates
Gross margin
94.2%
Operating margin
27.7%
Net margin
6.7%
ROE
0.2%
ROA
0.4%
Health
Liquidity and balance-sheet strength
Debt / equity
0.00x
Current ratio
4.80x
Quick ratio
4.20x
Total debt
$151.00K
Total cash
$14.14M
Growth
How the business has been compounding
Revenue TTM
$22.56M
Revenue 5Y CAGR
58.2%
EPS TTM
0.03
EPS 5Y CAGR
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Cash flow
How much cash the business throws off
Operating CF TTM
$6.17M
Free CF TTM
$-66.79M
FCF margin
-296.1%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
—
Last ex-div date
2023-06-16