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Royal Gold (RGLD)
NASDAQ:RGLD
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Royal Gold
(NASDAQ:RGLD)
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Rating:74Outperform
Price Target:
$311.00
▲(8.20% Upside)
Action:ReiteratedDate:02/19/26
The score is driven primarily by strong profitability and a solid balance sheet, reinforced by a positive earnings call highlighting record results and improving debt repayment trajectory. This is tempered by volatile/negative recent free cash flow and a demanding valuation (high P/E, low yield), while technicals remain supportive but not strongly overextended.
Positive Factors
High profitability & margins
Royal Gold's royalty/streaming model generates very high operating and net margins (TTM net margin >50% and adjusted EBITDA 82%), reflecting low operating capital needs and outsized cash conversion on revenue. Such structural margin advantage supports durable returns and dividend capacity over multi-year horizons.
Strong operating cash generation
Consistently strong operating cash flow (record annual and quarterly totals) underpins the company's ability to fund dividends, acquisitions and debt repayment without operating leverage. Durable OCF reflects cash receipts from long-lived royalty and streaming contracts that are less cyclical than mine-level operating costs.
Portfolio diversification & growth
Recent strategic acquisitions materially broaden the asset base across metals and stages (producing and development), reducing single-asset concentration and increasing future revenue optionality. A larger, diversified portfolio smooths cash flow volatility and creates multiple development upside paths over the medium term.
Negative Factors
Negative / volatile free cash flow
Despite strong operating cash flow, free cash flow has been uneven and negative in the TTM period, reflecting heavy investments, working-capital swings or acquisition outlays. Persistent FCF volatility can constrain organic funding capacity and increase reliance on external liquidity for dividends or growth.
Operator & delivery dependence
Royal Gold's economics hinge on third-party mine operators and delivery schedules; variability in production timing and operator performance introduces durable execution risk. Project-level uncertainties (e.g., Hod Maden funding) and operator guidance sensitivity can materially affect medium-term revenue visibility.
Higher debt and interest costs post-acquisitions
The recent acquisition-driven increase in absolute debt and higher interest expense elevates financial leverage compared with prior minimal-debt years. This raises refinancing and coverage risk if cash flows weaken and limits optionality for additional M&A or capital returns absent continued strong cash generation.
Royal Gold (RGLD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$24.43B
Dividend Yield0.77%
Average Volume (3M)944.60K
Price to Earnings (P/E)43.0
Beta (1Y)0.49
Revenue Growth28.11%
EPS Growth66.85%
CountryUS
Employees30
SectorBasic Materials
Sector Strength58
IndustryGold
Share Statistics
EPS (TTM)1.92
Shares Outstanding84,810,100
10 Day Avg. Volume805,436
30 Day Avg. Volume944,603
Financial Highlights & Ratios
PEG Ratio1.02
Price to Book (P/B)2.16
Price to Sales (P/S)14.98
P/FCF Ratio21.89
Enterprise Value/Market Cap0.80
Enterprise Value/Revenue19.04
Enterprise Value/Gross Profit26.22
Enterprise Value/Ebitda25.35
Forecast
1Y Price Target
$306.86Price Target Upside6.76% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)12.94
Revenue Forecast (FY)$1.99B
Royal Gold Business Overview & Revenue Model
Company DescriptionRoyal Gold, Inc., together with its subsidiaries, acquires and manages precious metal streams, royalties, and related interests. It focuses on acquiring stream and royalty interests or to finance projects that are in production or in development stage in exchange for stream or royalty interests, which primarily consists of gold, silver, copper, nickel, zinc, lead, and cobalt. As of June 30, 2022, the Company owned interests in 185 properties on five continents, including interests on 41 producing mines and 19 development stage projects. Its stream and royalty interests on properties are located in the United States, Canada, Chile, the Dominican Republic, Australia, Africa, Mexico, and internationally. Royal Gold, Inc. was incorporated in 1981 and is headquartered in Denver, Colorado.
How the Company Makes MoneyRoyal Gold generates revenue through its streaming and royalty agreements with mining companies. Under these agreements, Royal Gold provides capital to mining companies for the development of mining projects in exchange for a percentage of the mine's future production at a fixed, below-market price, or a percentage of revenue. The company earns income primarily from the sale of the metals it receives through these agreements at market prices, which can be significantly higher than the fixed costs. Additionally, Royal Gold benefits from increases in metal prices and production levels at the mines in which it holds interests. Key revenue streams for the company include royalties, which are calculated as a percentage of revenue from the mine, and streams, which involve purchasing a portion of the mine's production at a discounted rate. The company also seeks to diversify its portfolio by entering into agreements with multiple mining operators across different geographic locations and maintaining a focus on high-quality, long-life assets. Significant partnerships with established mining companies and a disciplined approach to investment further contribute to Royal Gold's earnings and growth potential.
Royal Gold Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Positive
The call presents a strongly positive operational and financial picture: record revenue, cash flow and adjusted earnings, meaningful portfolio diversification via acquisitions, continued dividend growth, and faster-than-expected debt reduction. The primary negatives are largely transactional and one-time in nature (integration costs, a onetime Versamet share loss, higher DD&A from purchase accounting) and short-term delivery/timing variability and project-level uncertainties (Hod Maden, Pueblo Viejo recovery questions). Management characterizes most negatives as nonrecurring and expects a steadier profile in 2026, supporting a favorable outlook.Q4-2025 Updates
Positive Updates
Record Annual Financial Performance
Full-year 2025 revenue of $1.0 billion (+43% vs 2024), operating cash flow of $705 million (+33%), GAAP earnings of $466 million (+40%), and adjusted net income of $510 million (+47% vs 2024). Adjusted EBITDA margin was 82% for the year.
Quarterly Revenue and Volume Records
Q4 revenue was a record $375 million on 90,800 GEOs. Stream revenue for the quarter was $265 million (up >110% YoY). Royalty revenue rose 42% YoY to $111 million.
Strong Metal Price Tailwinds
Metal prices drove revenue growth in the quarter with gold up 55% YoY, silver up 74% YoY and copper up 21% YoY; gold accounted for 78% of total revenue for the year and quarter.
Portfolio Growth and Diversification via Acquisitions
Completed major acquisitions including Sandstorm Gold and Horizon Copper and added a gold stream on Kansanshi and interests in Warintza and Lawyers-Ranch, expanding to ~80 producing and ~30 development assets and materially diversifying the portfolio.
Shareholder Returns and Dividend Increase
Paid >$118 million in dividends during 2025 and raised the annual dividend to $1.90 per share for 2026. This marks the 25th consecutive annual dividend increase. Since 2000, ~ $1.2 billion returned to shareholders.
Debt Reduction and Liquidity Position
Drew $450 million on revolver for acquisitions in Oct, then reduced debt from $1.225 billion to $900 million by year-end and to $725 million in early 2026. Available revolver capacity ~$675 million; total available liquidity ~$757 million. Now expect full debt repayment in early 2027 (earlier than prior mid-2027 forecast).
Operational and Development Upside in Key Assets
Positive portfolio developments: Mount Milligan life-of-mine extension to 2045, Khoemacau expansion approved, Fourmile exploration success at Cortez, Xavantina life extension to 2032, Platreef Phase I sales and expected first revenue H1 2026, Kansanshi stream deliveries began and guidance indicates growth in attributable gold sales to 38k-43k oz by 2028.
Strong Operating Cash Flow Quarter
Q4 operating cash flow was a record $242 million, up from $141 million year-over-year, driven by higher stream and royalty revenues and first delivery proceeds for Mount Milligan cost support agreement.
Negative Updates
One-Time Acquisition-Related Costs and Earnings Impact
Several one-time items in Q4 tied to Sandstorm/Horizon and other transactions: integration costs (~$4.5 million), acquisition-related costs ~$14 million, and a one-time loss of approximately $48 million on the sale of Versamet shares, which contributed to lower GAAP net income in the quarter.
Q4 Net Income Decline vs Prior Year
Q4 GAAP net income was $94 million ($1.16/share) vs $107 million ($1.63/share) in prior-year quarter; adjusted net income after removing one-time items was $155 million ($1.92/share), indicating notable adjustment from GAAP results.
Higher G&A and Nonrecurring Employee Costs
G&A rose to $17.6 million in Q4 (~$9 million higher YoY) largely due to integration (~$4.5M) and increased employee-related (including stock comp) costs (~$3M). Management estimates 2026 G&A of $50–$60 million after anticipated synergies.
Increased DD&A from Purchase Accounting Step-Ups
DD&A increased to $80 million from $34 million YoY; unit depletion $881 per GEO vs $444 prior year. Incremental depletion primarily due to $33M from Sandstorm assets and $13M from Kansanshi, reflecting higher carrying values under purchase accounting.
Higher Interest Expense and Elevated Reported Tax Rate in Quarter
Interest and other expense rose to $17.7 million (from $1.4M) due to higher revolver usage. Q4 tax expense was $53 million with an effective tax rate of 36% (prior quarter tax $26M); management estimates adjusted ETR ~22.5% excluding one-offs.
Timing and Delivery Variability Affecting Short-Term Guidance
Q1 2026 GEO sales expected in line with Q4 and to be the lowest quarter of 2026; management cites delivery timing variability across major assets and limited near-term visibility on royalty deliveries, making short-term modeling more uncertain.
Hod Maden Funding and Strategic Uncertainty
Hod Maden feasibility shows significant capex (~$910 million) and Royal Gold remains a 30% JV partner required to fund share of project costs. Management is considering converting the JV stake into a royalty/stream to reduce construction/operating risk, but timing and outcome are uncertain.
Company Guidance
Guidance and forward-looking commentary focused on 2026 and near-term pacing: the company expects Q1 2026 GEO sales to be in line with Q4 2025 (90,800 GEOs) and believes Q1 will be the lowest quarter of the year, will provide full 2026 revenue and DD&A guidance at Investor Day (Mar 31), and estimates 2026 total G&A of $50–$60 million (reflecting anticipated post‑acquisition synergies). Portfolio-linked operator guidance the Company cited includes Pueblo Viejo (Barrick) 2026 gold of 350,000–400,000 oz (their share), Cortez complex 700,000–780,000 oz (100% basis) with an expected blended royalty rate of ~3.5–4% in 2026 (vs. 2.6% in 2025), Xavantina (Ero) 40,000–50,000 oz in 2026, Kansanshi stream sales to Royal Gold of ~26,000–31,000 oz in 2026 (rising to 38,000–43,000 oz in 2028), and Khoemacau silver to Royal Gold of ~1.45–1.55 million oz in 2026 (90% payable factor). Financial posture/guidance items: year‑end debt was $900 million, subsequent repayments reduced outstanding debt to $725 million with ~$675 million available under the revolver, total available liquidity cited as $757 million (including $257 million working capital), remaining $200 million warrant funding to be paid in two $50 million tranches this year, and management now expects to fully repay the credit balance in early 2027 (earlier than prior mid‑2027 forecast).Royal Gold Financial Statement Overview
Summary
Strong profitability and improving recent revenue growth support a high score, and leverage remains manageable. The main constraint is weaker cash-flow quality: free cash flow has been volatile and recently negative, which matters more given the recent step-up in debt.Income Statement
Profitability is a clear strength: margins are very high across the period, with TTM (Trailing-Twelve-Months) net margin above 50% and strong operating profitability. Growth improved meaningfully in TTM (Trailing-Twelve-Months) with revenue up ~20% versus low-to-modest growth in most prior years. The main caution is volatility in reported margin levels year-to-year (notably the sharp drop in gross margin in TTM (Trailing-Twelve-Months) versus 2021–2024), which signals some sensitivity to pricing/contract economics or one-off items.86
Very Positive
Balance Sheet
The balance sheet looks solid with low leverage historically and still manageable leverage in TTM (Trailing-Twelve-Months) (debt-to-equity ~0.13). Equity and assets have increased sharply in the latest TTM (Trailing-Twelve-Months) snapshot, and returns on equity have improved to the mid-teens. The key weakness is the step-up in absolute debt in TTM (Trailing-Twelve-Months) after years of minimal/zero debt, which increases financial risk if cash generation is pressured.83
Very Positive
Cash Flow
Operating cash flow is consistently strong and comfortably covers earnings (TTM (Trailing-Twelve-Months) operating cash flow is several times net income), which supports underlying cash earning power. However, free cash flow is the main issue: it is negative in TTM (Trailing-Twelve-Months) and was also deeply negative in 2022, indicating periods of heavy investment or working-capital swings that can constrain flexibility despite strong operating inflows. The mix of very strong operating cash flow but uneven free cash flow lowers overall cash-flow quality.58
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Jun 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.03B | 712.77M | 598.42M | 596.18M | 645.17M |
| Gross Profit | 713.86M | 615.26M | 507.90M | 501.54M | 546.70M |
| EBITDA | 774.35M | 574.33M | 468.14M | 466.93M | 517.40M |
| Net Income | 466.28M | 332.02M | 239.44M | 238.98M | 274.04M |
Balance Sheet | |||||
| Total Assets | 9.54B | 3.39B | 3.36B | 3.53B | 2.76B |
| Cash, Cash Equivalents and Short-Term Investments | 233.72M | 195.50M | 104.17M | 118.59M | 143.55M |
| Total Debt | 965.61M | 0.00 | 245.97M | 571.57M | 0.00 |
| Total Liabilities | 2.33B | 260.92M | 460.42M | 781.05M | 155.82M |
| Stockholders Equity | 7.16B | 3.12B | 2.89B | 2.74B | 2.59B |
Cash Flow | |||||
| Free Cash Flow | 704.85M | 426.94M | 413.11M | -504.81M | 239.00M |
| Operating Cash Flow | 704.85M | 529.50M | 415.79M | 417.35M | 407.15M |
| Investing Cash Flow | -1.42B | -77.68M | -2.83M | -922.88M | -116.74M |
| Financing Cash Flow | 751.93M | -360.49M | -427.38M | 480.57M | -383.63M |
Royal Gold Technical Analysis
Positive
287.44
Price Trends
258.00
Positive
224.44
Positive
199.22
Positive
Market Momentum
7.36
Positive
58.81
Neutral
71.32
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RGLD, the sentiment is Positive. The current price of 287.44 is above the 20-day moving average (MA) of 277.39, above the 50-day MA of 258.00, and above the 200-day MA of 199.22, indicating a bullish trend. The MACD of 7.36 indicates Positive momentum. The RSI at 58.81 is Neutral, neither overbought nor oversold. The STOCH value of 71.32 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RGLD.
Royal Gold Risk Analysis
Royal Gold disclosed 35 risk factors in its most recent earnings report. Royal Gold reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Royal Gold Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $13.49B | 16.92 | 32.05% | 0.87% | 29.08% | 72.12% | |
78 Outperform | $62.96B | 24.03 | ― | 2.82% | 26.43% | ― | |
75 Outperform | $49.73B | 14.23 | 52.47% | 1.51% | 49.62% | 195.39% | |
74 Outperform | $24.43B | 42.97 | 9.07% | 0.77% | 28.11% | 66.85% | |
72 Outperform | $134.99B | 19.41 | 22.21% | 0.95% | 26.25% | ― | |
61 Neutral | $10.43B | 7.12 | -0.05% | 2.87% | 2.86% | -36.73% | |
49 Neutral | $11.32B | -41.46 | -12.14% | ― | 6.27% | 93.14% |
* Basic Materials Sector Average
RGLD
Royal Gold
287.44
143.79
100.09%
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.