Royal Gold, Inc. acquires and manages precious metals royalties, metal streams, and similar interests in the United States, Canada, Chile, and Mexico. The company also holds royalty and stream interests in mines and projects in other countries, including Argentina, Australia, Bolivia, Brazil, Burkina Faso, the Dominican Republic, Finland, Ghana, Guatemala, Honduras, Macedonia, Nicaragua, Peru, Russia, Spain, and Tunisia. The company was founded in 1981 and is based in Denver, Colorado.
RGLD Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Royal Gold Inc with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Royal Gold Inc ranked in the 55th percentile in terms of potential gain offered. Moreover, under all the scenarios we modelled, the output consistently forecasted positive returns. In terms of the factors that were most noteworthy in this DCF analysis for RGLD, they are:
The business' balance sheet suggests that 2% of the company's capital is sourced from debt; this is greater than only 7.66% of the free cash flow producing stocks we're observing.
Royal Gold Inc's effective tax rate, as measured by taxes paid relative to net income, is at 2 -- greater than only 24.39% of US stocks with positive free cash flow.
The company's cost of debt, derived from its interest coverage, tax rate, and market capitalization, is greater than only 0% of stocks in its sector (Basic Materials).
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Basic Materials that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as RGLD, try IOSP, GFI, VMC, MLM, and WOR.