ROYAL GOLD INC (RGLD) Stock Analysis
ROYAL GOLD INC (RGLD) Stock Analysis
Overall Grade: F (Concerning)
View interactive company profile →
ROYAL GOLD INC faces challenges in financial performance that warrant careful analysis.
Key Metrics:
| Metric | Value | Context |
|---|---|---|
| ROIC | N/A | Below expectations |
| FCF Margin | 68.4% | Strong cash generation |
| Debt/Equity | 0.1x | Conservative leverage |
Investment Thesis: Healthy free cash flow margin of 68.4% provides financial flexibility for growth and shareholder returns.
What is ROYAL GOLD INC's Profitability and ROIC?
ROYAL GOLD INC's return on invested capital of N/A is below the typical cost of capital.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Return on Invested Capital (ROIC) | N/A | Red flag | Below cost of capital |
| Return on Equity (ROE) | 12.4% | Adequate | Moderate equity returns |
How Strong is ROYAL GOLD INC's Cash Flow Quality?
ROYAL GOLD INC generated $704.8M in free cash flow over the trailing twelve months, representing a 68.4% margin. Cash earnings quality is strong, with operating cash flow exceeding net income by 1.5x.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Free Cash Flow Margin | 68.4% | Excellent | Excellent cash conversion |
| Free Cash Flow (TTM) | $704.8M | Good | Positive cash generation |
| OCF/Net Income | 1.5x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
What is ROYAL GOLD INC's Financial Health?
ROYAL GOLD INC's debt-to-equity ratio of 0.1x indicates conservative leverage.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| Debt to Equity | 0.1x | Excellent | Conservative capital structure |
| Net Cash Position | $-661.7M | Adequate | Net debt position |
Is ROYAL GOLD INC Stock Overvalued or Undervalued?
ROYAL GOLD INC trades at a P/E of 33.2x, representing a premium to the sector median of N/A. Free cash flow yield of 4.6% reflects market expectations for growth.
Key Metrics
| Metric | Value | Rating | Interpretation |
|---|---|---|---|
| P/E Ratio | 33.2x | Adequate | Premium valuation |
| EV/Sales | 15.1x | Warning | Growth premium priced in |
| FCF Yield | 4.6% | Good | Lower cash yield |
| Dividend Yield | 0.8% | Adequate | Growth focus over income |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Free Cash Flow Margin | 68.4% | Top 25% | 5.0x above |
| Return on Equity (ROE) | 12.4% | Top 25% | 2.6x above |
| P/E Ratio | 33.2x | N/A | - |
Rating Thresholds
Free Cash Flow Margin
The percentage of revenue converted to free cash flow. Higher margins indicate stronger cash generation and business quality.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 20% | Strong cash generation, high-quality business |
| Good | 10% - 20% | Healthy cash conversion |
| Adequate | 5% - 10% | Moderate cash generation |
| Warning | 0% - 5% | Thin cash margins, capital intensive |
| Red flag | < 0% | Cash burn, potential liquidity concerns |
Current: 68.4% (Excellent - Top 25% of sector (median: 13.8%))
Debt to Equity Ratio
Total debt divided by shareholders' equity. Lower ratios indicate more conservative financing and reduced financial risk.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | < 0.3x | Conservative leverage, strong balance sheet |
| Good | 0.3x - 0.7x | Moderate leverage, healthy financial position |
| Adequate | 0.7x - 1.5x | Elevated leverage, monitor closely |
| Warning | 1.5x - 3.0x | High leverage, increased financial risk |
| Red flag | > 3.0x | Excessive leverage, potential distress risk |
Current: 12.5% (Excellent)
P/E Ratio (Price-to-Earnings)
Stock price divided by earnings per share. Lower P/E may indicate undervaluation, while higher P/E suggests growth expectations.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | < 15x | Attractively valued, potential opportunity |
| Good | 15x - 25x | Fair value for quality company |
| Adequate | 25x - 35x | Growth premium, justify with earnings growth |
| Warning | 35x - 50x | High expectations priced in |
| Red flag | > 50x or negative | Speculative valuation or losses |
Current: 33.2x (Adequate)
Free Cash Flow Yield
Free cash flow per share divided by stock price. Higher FCF yield indicates better cash return relative to valuation.
| Rating | Range | Interpretation |
|---|---|---|
| Excellent | > 8% | High cash return, potential value opportunity |
| Good | 5% - 8% | Solid cash yield |
| Adequate | 3% - 5% | Moderate cash return |
| Warning | 1% - 3% | Low cash yield, growth expectations |
| Red flag | < 1% | Minimal cash return to shareholders |
Current: 4.6% (Adequate)
Frequently Asked Questions
Q: What is ROYAL GOLD INC's Return on Invested Capital (ROIC)?
ROYAL GOLD INC (RGLD) has a trailing twelve-month Return on Invested Capital (ROIC) of N/A. This compares below the sector median of 8.6%. An ROIC below 8% suggests the company may be destroying shareholder value.
Q: What is ROYAL GOLD INC's Free Cash Flow Margin?
ROYAL GOLD INC (RGLD) has a free cash flow margin of 68.4%, generating $704.8 million in free cash flow over the trailing twelve months. A FCF margin above 20% indicates excellent cash conversion and a high-quality business model.
Q: Is ROYAL GOLD INC stock overvalued or undervalued?
ROYAL GOLD INC (RGLD) trades at a P/E ratio of 33.2x, which is above the sector median of N/A. The EV/Sales multiple is 15.1x. Free cash flow yield is 4.6%, which is in line with market averages.
Q: Does ROYAL GOLD INC pay a dividend?
ROYAL GOLD INC (RGLD) currently pays a dividend yield of 0.8%. Including share buybacks, the total shareholder yield is 0.8%. The relatively low yield suggests the company prioritizes growth reinvestment over income distribution.
Q: What is ROYAL GOLD INC's revenue and earnings growth?
ROYAL GOLD INC (RGLD) grew revenue by 43.2% year-over-year. Earnings per share increased by 32.7% compared to the prior year. Double-digit revenue growth indicates strong demand and market share gains.
Q: How does ROYAL GOLD INC compare to competitors in Real Estate?
Compared to other companies in Real Estate, ROYAL GOLD INC (RGLD) shows: ROIC of N/A is below the sector median of 8.6% (NaNx median). FCF margin of 68.4% exceeds the sector median of 13.8% (Top 14% of sector). These rankings are based on MetricDuck's analysis of all Real Estate companies with available SEC filings.
Q: What warning signs should I watch for with ROYAL GOLD INC?
ROYAL GOLD INC (RGLD) shows no major financial warning signs based on current metrics. However, investors should always monitor: 1) Margin compression trends, 2) Cash flow consistency, 3) Debt levels relative to cash generation, and 4) Changes in competitive positioning.
Data Source: Data sourced from 10-Q filed 2025-11-06. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
This analysis is for informational purposes only and does not constitute investment advice.