Diversified Royalty Corp (DIV) AI Stock Analysis

• Market Cap: C$576.79M
• Dividend Yield: 7.14%
• Average Volume (3M): 316.19K
• Price to Earnings (P/E): 20.9
• Beta (1Y): 0.67
• Revenue Growth: 6.88%
• EPS Growth: -13.39%
• Country: CA
• Employees: 43
• Sector: Industrials
• Sector Strength: 72
• Industry: Conglomerates
• EPS (TTM): 0.05
• Shares Outstanding: 155,888,570
• 10 Day Avg. Volume: 329,600
• 30 Day Avg. Volume: 316,190
• PEG Ratio: -0.65
• Price to Book (P/B): 1.63
• Price to Sales (P/S): 7.26
• P/FCF Ratio: 10.15
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$4.38
• Price Target Upside: 18.38% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 78 Outperform
• Price Target: C$4.50 ▲(21.62% Upside)

Diversified Royalty Corp's strong financial performance and positive corporate events, such as dividend increases, are the main strengths. However, technical indicators suggest caution due to potential overbought conditions, and the high P/E ratio indicates potential overvaluation.

Positive Factors

Revenue Growth

The consistent revenue growth indicates a robust business model with expanding royalty streams, enhancing long-term earnings potential.

Cash Generation

Strong cash generation supports operational flexibility and potential for reinvestment or debt reduction, bolstering financial stability.

Profitability

High margins reflect efficient cost management and a strong competitive position, ensuring sustained profitability over time.

Negative Factors

Debt Levels

High leverage can increase financial risk, potentially limiting the company's ability to invest in growth or weather economic downturns.

Net Profit Margin Decline

A declining net profit margin suggests rising operational costs or taxes, which could pressure future profitability if not addressed.

EPS Growth Decline

Negative EPS growth indicates potential challenges in maintaining earnings momentum, which could affect investor confidence and stock performance.

Diversified Royalty Corp Business Overview & Revenue Model

Company Description

Diversified Royalty Corp., a multi-royalty corporation, engages in the acquisition of royalties from multi-location businesses and franchisors in North America. The company owns the Mr. Lube, AIR MILES, Sutton, Mr. Mikes, Nurse Next Door, and Oxford Learning Centres trademarks. The company was formerly known as BENEV Capital Inc. and changed its name to Diversified Royalty Corp. in September 2014. Diversified Royalty Corp. was incorporated in 1992 and is headquartered in Vancouver, Canada.

How the Company Makes Money

Diversified Royalty Corp generates revenue primarily through royalty payments derived from its franchise agreements. The company typically acquires a percentage of the gross sales from its partner brands, which include well-known franchises in the food and retail sectors. Key revenue streams include fixed royalties, which provide a stable income base, and additional performance-based royalties that increase as franchise sales grow. Significant partnerships with established brands allow DIV to benefit from their market presence and operational success, further enhancing its earnings potential. Additionally, the company may explore new acquisitions to expand its portfolio, contributing to long-term revenue growth.

Diversified Royalty Corp Financial Statement Overview

Summary

Diversified Royalty Corp exhibits strong financial performance with consistent revenue growth and high margins. However, the high debt-to-equity ratio poses a potential risk.

Income Statement

Diversified Royalty Corp has shown strong revenue growth with a 15% increase from 2023 to 2024. The company maintains high gross and EBIT margins at 100% and 77% respectively, indicating efficient cost management. However, the net profit margin decreased slightly to 41%, suggesting increased operational costs or taxes.

Balance Sheet

The company's debt-to-equity ratio is relatively high at 0.90, which may indicate higher financial leverage. The return on equity remains strong at 9.22%, and the equity ratio improved to 49.87%, reflecting good asset management and financial stability.

Cash Flow

The cash flow analysis shows a positive turnaround with a significant free cash flow of $46.5 million in 2024, signaling improved cash management. The operating cash flow to net income ratio of 1.75 suggests robust cash generation from operations.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	68.78M	64.99M	56.49M	45.18M	37.28M	30.50M
Gross Profit	68.75M	64.89M	56.40M	42.91M	35.31M	29.00M
EBITDA	58.38M	55.21M	58.77M	33.36M	41.16M	-3.43M
Net Income	29.70M	26.62M	31.72M	15.56M	23.52M	-8.88M
Balance Sheet
Total Assets	616.97M	578.98M	567.35M	458.45M	380.76M	358.40M
Cash, Cash Equivalents and Short-Term Investments	4.05M	19.69M	4.03M	7.41M	8.94M	9.22M
Total Debt	293.23M	260.47M	305.16M	199.78M	169.66M	156.20M
Total Liabilities	326.97M	290.18M	329.95M	224.56M	189.24M	168.72M
Stockholders Equity	289.99M	288.80M	237.40M	233.89M	191.53M	189.67M
Cash Flow
Free Cash Flow	-4.79M	46.48M	-46.41M	-50.93M	10.86M	-22.22M
Operating Cash Flow	44.72M	46.49M	30.82M	28.38M	27.82M	22.10M
Investing Cash Flow	-49.51M	-8.00K	-77.22M	-79.31M	-16.96M	-44.32M
Financing Cash Flow	-6.91M	-30.77M	43.05M	49.37M	-11.14M	28.47M

Diversified Royalty Corp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.70
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DIV, the sentiment is Positive. The current price of 3.7 is below the 20-day moving average (MA) of 3.70, above the 50-day MA of 3.56, and above the 200-day MA of 3.18, indicating a neutral trend. The MACD of 0.04 indicates Positive momentum. The RSI at 55.22 is Neutral, neither overbought nor oversold. The STOCH value of 20.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:DIV.

Diversified Royalty Corp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DIV	78 Outperform	C$576.79M	20.89	10.28%	7.14%	6.88%	-13.39%
WJX	73 Outperform	C$593.57M	12.92	8.84%	5.10%	3.71%	-12.70%
DXT	72 Outperform	C$737.87M	18.77	14.38%	3.02%	-0.73%	221.74%
KBL	71 Outperform	C$447.64M	20.90	8.30%	3.43%	26.29%	-6.47%
CGY	71 Outperform	C$641.49M	31.92	6.36%	1.98%	3.69%	92.38%
DE	66 Neutral	C$139.64M	24.66	10.07%	7.88%	16.69%	111.74%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Diversified Royalty Corp Corporate Events

Diversified Royalty Corp. Increases Annual Dividend for 2025

Diversified Royalty Corp. announced an increase in its annual dividend from $0.275 to $0.285 per share, effective December 1, 2025. The board approved a cash dividend of $0.02375 per common share for December 2025, reflecting the annual increase. This move underscores DIV’s commitment to providing predictable and stable dividends, enhancing shareholder value and potentially strengthening its market position.

Diversified Royalty Corp. Reports Strong Q3 2025 Results and Announces Dividend Increase

Diversified Royalty Corp. reported a strong financial performance for the third quarter of 2025, with a notable 5.0% increase in weighted average organic royalty growth. The company’s revenue rose by 13.4% compared to the previous year, and it announced a 1¢ increase in its annualized dividend, reflecting confidence in its continued growth. The positive results were driven by strong performances from partners like Mr. Lube + Tires and Oxford, despite challenges such as the decline in AIR MILES® royalties. The addition of Cheba Hut contributed to the growth, and the company remains focused on maintaining robust organic growth in a challenging economic environment.

Diversified Royalty Corp. Declares November Dividend and Sets Q3 Earnings Release Date

Diversified Royalty Corp. announced a cash dividend of $0.02292 per common share for November 2025, with payment scheduled for November 28, 2025. Additionally, the company will release its Q3 2025 earnings results on November 12, 2025. This announcement underscores DIV’s commitment to providing predictable and stable dividends to its shareholders, reflecting its strategy of enhancing shareholder value through strategic royalty acquisitions and growth.

Diversified Royalty Corp. Declares October 2025 Cash Dividend

Diversified Royalty Corp. announced a cash dividend of $0.02292 per common share for October 2025, reflecting an annualized dividend of $0.275 per share. This decision underscores DIV’s commitment to providing predictable and stable monthly dividends to its shareholders, aligning with its corporate objectives of enhancing cash flow per share through strategic royalty acquisitions. The announcement is expected to reinforce the company’s market position and offer reassurance to stakeholders regarding its financial stability and growth prospects.