Reasons to be bullish on Royal Gold (RGLD):
- A positive levered free cash flow of $5.13 million
- Net income has almost doubled since 2009; in 2011 it stood at $71 million compared with $38 million in 2009.
- EBTIDA has increased from $97 million in 2009 to $191 million in 2011
- Cash flow from operating activities has surged almost 500% from its 2009 levels of $30.5 million compared with the 2011 figure of $146 million.
- It boosts a strong dividend three-year growth rate of 18.42%
- It has a five-year sales growth of 41%.
- Cash flow per share has doubled from $1.25 in 2009 to $2.55 in 2011
- A good quarterly earnings and revenue growth rate of 27% and 22% respectively.
- It has a great quick and current ratio of 5.5 and 5.87 respectively
- It has an excellent payout ratio of 28% and very strong interest coverage ratio of 25
- A low long-term debt-to-equity ratio of 0.18
- A good fiver-year EPS growth rate of 14.35%
- An annual EPS growth rate of 27%
- Consecutive dividend increases for 10 years
- A strong total three- and five-year total return of 78% and 121%
- A decent free cash flow yield of 4.57%
- The high-end EPS estimates for 2012 and 2013 are $2.19 and $2.90 respectively, while the average for 2012 and 2013 stands at $1.90 and $2.38 respectively.
- $100K invested for 10 years would have grown into a whopping $1.34 million dollars.
Royal Gold, Inc.
Industry: Precious Metals
Levered Free Cash Flow: 5.13M
Net income for the past three years
Net Income 2009 = $38 million
Net Income 2010 = $21 million
Net Income 2011 = $71 million
EBITDA 12/2011 = $191 million
EBITDA 12/2010 = $101 million
EBITDA 12/2009 = $97 million
Net income Reported Quarterly = $231 million
Total cash flow from operating activities
2009 = $30.05 million
2010 = $48.38 million
2011 = $146.96 million
Cash Flow 12/2011 = 2.55 $/share
Cash Flow 12/2010 = 1.7 $/share
Cash Flow 12/2009 = 1.25 $/share
Anl EPS before NRI 12/2011 = 1.29
Anl EPS before NRI 12/2010 = 0.82
Anl EPS before NRI 12/2009 = 0.52
Anl EPS before NRI 12/2008 = 0.84
Anl EPS before NRI 12/2007 = 0.79
ROE = 5.92%
Return on Assets = 4.6%
Quarterly Earnings Growth = 27.8%
Quarterly Revenue Growth = 22.2%
Key Ratios
Price to Sales = 15.87
Price to Book = 2.42
Price to Tangible Book = 2.64
Price to Cash Flow = 26.22
Price to Free Cash Flow = -213.5
Current Ratio 09/2011 = 5.5
Current Ratio 5 Year Average = 17.39
Quick Ratio = 5.87
Cash Ratio = 4.17
Interest Coverage 09/2011 = 24.94
Payout Ratio 09/2011 = 0.28
Payout Ratio 06/2011 = 0.3
Payout Ratio 5 Year Avg 09/2011 = 0.41
Payout Ratio 5 Year Avg 06/2011 = 0.41
Change in Payout Ratio = -0.13
Dividend growth rate 3 year avg = 18.42%
Consecutive dividend increases = 10 years
Paying dividends since = 2000
Total return last 3 years = 78.15%
Total return last 5 years = 120.09%
Related companies (Peer Group Analysis)
Yamana Gold, Inc. (NYSE: AUY)
Industry : Precious Metals
Levered Free Cash Flow : 213.70M
Net income for the past three years
Net Income 2009 = $193 million
Net Income 2010 = $451 million
Net Income 2011 = $548 million
EBITDA 12/2011 = $1196 million
EBITDA 12/2010 = $906 million
EBITDA 12/2009 = $585 million
Net income Reported Quarterly = $231 million
Total cash flow from operating activities
2008 = $308.87 million
2009 = $528.03 million
2010 = $613.06 million
Cash Flow 12/2011 = 1.43 $/share
Cash Flow 12/2010 = 1.01 $/share
Cash Flow 12/2009 = 0.79 $/share
Anl EPS before NRI 12/2011 = 0.96
Anl EPS before NRI 12/2010 = 0.61
Anl EPS before NRI 12/2009 = 0.47
Anl EPS before NRI 12/2008 = 0.52
Anl EPS before NRI 12/2007 = 0.53
ROE = 9.67%
Return on Assets = 6.72%
Quarterly Earnings Growth = -28.6%
Quarterly Revenue Growth = 6.3%
Key Ratios
Price to Sales = 5.77
Price to Book = 1.67
Price to Tangible Book = 1.73
Price to Cash Flow = 11.73
Price to Free Cash Flow = 12.2
Current Ratio 09/2011 = 2.23
Current Ratio 5 Year Average = 1.93
Quick Ratio = 1.9
Cash Ratio = 1.48
Interest Coverage 09/2011 = 12.38
Payout Ratio 09/2011 = 0.21
Payout Ratio 06/2011 = 0.19
Payout Ratio 5 Year Avg 09/2011 = 0.14
Payout Ratio 5 Year Avg 06/2011 = 0.14
Change in Payout Ratio = 0.07
Dividend growth rate 3 year avg = 44.95%
Consecutive dividend increases = 2 years
Paying dividends since = 2006
Total return last 3 years = 105.45%
Total return last 5 years = 26.24%
Newmont Mining Corp. (Holding (NYSE: NEM)
Industry : Precious Metals
Levered Free Cash Flow: 1.12B
Net income for the past three years
Net Income 2009 = $1297 million
Net Income 2010 = $2277 million
Net Income 2011 = $366 million
EBITDA 12/2011 = $3090 million
EBITDA 12/2010 = $5221 million
EBITDA 12/2009 = $3880 million
Net income Reported Quarterly = $231 million
Total cash flow from operating activities
2009 = $2.95 billion
2010 = $3.17 billion
2011 = $3.59 billion
Cash Flow 12/2011 = 6.57 $/share
Cash Flow 12/2010 = 5.84 $/share
Cash Flow 12/2009 = 4.51 $/share
Anl EPS before NRI 12/2011 = 4.33
Anl EPS before NRI 12/2010 = 3.78
Anl EPS before NRI 12/2009 = 2.79
Anl EPS before NRI 12/2008 = 1.99
Anl EPS before NRI 12/2007 = 1.28
ROE = 13.13%
Return on Assets = 7.74%
Key Ratios
Price to Sales = 2.69
Price to Book = 1.76
Price to Tangible Book = 2.22
Price to Cash Flow = 8.66
Price to Free Cash Flow = -13.1
Current Ratio 09/2011 = 1.37
Current Ratio 5 Year Average = 2.03
Quick Ratio = 1.19
Cash Ratio = 1.03
Payout Ratio 09/2011 = 0.32
Payout Ratio 06/2011 = 0.28
Payout Ratio 5 Year Avg 09/2011 = 0.21
Payout Ratio 5 Year Avg 06/2011 = 0.2
Change in Payout Ratio = 0.11
Dividend growth rate 3 year avg = 41.67%
Consecutive dividend increases = 2 years
Paying dividends since = 1934
Total return last 3 years = 56.21%
Total return last 5 years = 41.48%
Silvercorp Metals Inc (NYSE: SVM)
Industry : Precious Metals
Levered Free Cash Flow : 57.64M
Net income for the past three years
Net Income 2009 = $-16 million
Net Income 2010 = $39 million
Net Income 2011 = $69 million
EBITDA 12/2011 = $118 million
EBITDA 12/2010 = $65 million
EBITDA 12/2009 = $-8 million
Net income Reported Quarterly = $231 million
Total cash flow from operating activities
2009 = $48.01 million
2010 = $65.26 million
2011 = $104.25 million
Cash Flow 12/2011 = 0.41 $/share
Cash Flow 12/2010 = 0.26 $/share
Cash Flow 12/2009 = 0.21 $/share
Anl EPS before NRI 12/2011 = 0.38
Anl EPS before NRI 12/2010 = 0.24
Anl EPS before NRI 12/2009 = 0.18
Anl EPS before NRI 12/2008 = 0.4
Anl EPS before NRI 12/2007 = 0.44
ROE = 17.12%
Return on Assets = 15.11%
Quarterly Earnings Growth = -31.1%
Quarterly Revenue Growth = 19.4%
Key Ratios
Price to Sales = 5.24
Price to Book = 2.48
Price to Tangible Book = 2.9
Price to Cash Flow = 17.86
Price to Free Cash Flow = 12.7
Current Ratio 09/2011 = 4.09
Current Ratio 5 Year Average = 5.01
Quick Ratio = 5.77
Cash Ratio = 5.66
Payout Ratio 09/2011 = 0.21
Payout Ratio 06/2011 = 0.17
Payout Ratio 5 Year Avg 09/2011 = 0.28
Payout Ratio 5 Year Avg 06/2011 = 0.29
Change in Payout Ratio = -0.08
Dividend growth rate 3 year avg = 35.42%
Consecutive dividend increases = 0 years
Paying dividends since = 2007
Total return last 3 years = 246.56%
Total return last 5 years = 49.7%
Compania de Minas Buenaventura (NYSE: BVN)
Industry : Precious Metals
Levered Free Cash Flow : 168.49M
Net income for the past three years
Net Income 2009 = $657 million
Net Income 2010 = $663 million
Net Income 2011 = $964 million
EBITDA 12/2011 = $1283 million
EBITDA 12/2010 = $928 million
EBITDA 12/2009 = $822 million
Net income Reported Quarterly = $231 million
Total cash flow from operating activities
2008 = $150.52 million
2009 = $526.13 million
2010 = $527.75 million
Cash Flow 12/2011 = 3.76 $/share
Cash Flow 12/2010 = 2.89 $/share
Cash Flow 12/2009 = 2.62 $/share
Anl EPS before NRI 12/2011 = 3.39
Anl EPS before NRI 12/2010 = 2.61
Anl EPS before NRI 12/2009 = 2.33
Anl EPS before NRI 12/2008 = 2.95
ROE = 26.9%
Return on Assets = 23.31%
Quarterly Earnings Growth = 3.6%
Quarterly Revenue Growth = 1.4%
Key Ratios
Price to Sales = 6.61
Price to Book = 2.98
Price to Tangible Book = 3.48
Price to Cash Flow = 10.65
Price to Free Cash Flow = 52.3
Current Ratio 09/2011 = 3.02
Current Ratio 5 Year Average = 3.25
Quick Ratio = 2.55
Cash Ratio = 2.02
Interest Coverage 09/2011 = 44.27
Payout Ratio 09/2011 = 0.16
Payout Ratio 06/2011 = 0.14
Payout Ratio 5 Year Avg 09/2011 = 0.13
Payout Ratio 5 Year Avg 06/2011 = 0.13
Change in Payout Ratio = 0.03
Dividend growth rate 3 year avg = 63.11%
Consecutive dividend increases = 2 years
Paying dividends since = 1996
Total return last 3 years = 119.94%
Total return last 5 years = 204.59%
Conclusion
Long-term investors should wait for a strong pullback before committing new funds to this market.
EPS, EPS surprise, broker recommendations, and price and consensus charts sourced from zacks.com. Earning's estimates and growth rate charts sourced from dailyfinance.com. Free cash flow yield, income from cont operations, and revenue growth sourced from Ycharts.com. Earnings VS expectation's charts sourced from smartmoney.com . Earnings summary extracted from chevron.com
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Additional disclosure: This list of stocks is meant to serve as a starting point. Please do not treat this as a buying list. It is imperative that you do your due diligence and then determine if any of the above plays meet with your risk tolerance levels. The Latin maxim caveat emptor applies-let the buyer beware.
