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Diversified Royalty Corp
(TSX:DIV)
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Rating:71Outperform
Price Target:
C$5.50
â–²(27.02% Upside)
Action:Upgraded
Date:05/16/26
The score is driven primarily by strong underlying profitability, but moderated by leverage and uneven free-cash-flow consistency. Technicals add support with an uptrend and positive MACD, while valuation is balanced between a high dividend yield and a mid-to-high P/E.
Positive Factors
High profitability
Sustained very high net margins (~52% TTM) indicate the royalty model generates outsized profitability relative to peers. Durable margin strength provides a cushion against revenue dips, supports dividend capacity and debt servicing, and enhances long-term return stability for the business.
Negative Factors
Moderate leverage
Meaningful leverage (D/E ~0.89) reduces financial flexibility and raises refinancing and covenant risk if earnings or cash flows weaken. For a royalty company reliant on steady partner sales, leverage amplifies downside and can constrain capital deployment or opportunistic acquisitions.
Read all positive and negative factors
Positive Factors
Negative Factors
High profitability
Sustained very high net margins (~52% TTM) indicate the royalty model generates outsized profitability relative to peers. Durable margin strength provides a cushion against revenue dips, supports dividend capacity and debt servicing, and enhances long-term return stability for the business.
Read all positive factors
Diversified Royalty Corp (DIV) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$790.06M
Dividend Yield7.14%
Average Volume (3M)316.19K
Price to Earnings (P/E)21.5
Beta (1Y)0.79
Revenue Growth10.83%
EPS Growth30.66%
CountryCA
Employees44
SectorIndustrials
Sector Strength72
IndustrySpecialty Business Services
Share Statistics
EPS (TTM)0.21
Shares Outstanding171,009,490
10 Day Avg. Volume329,600
30 Day Avg. Volume316,190
Financial Highlights & Ratios
PEG Ratio0.45
Price to Book (P/B)2.18
Price to Sales (P/S)8.88
P/FCF Ratio13.84
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$5.65Price Target Upside30.48% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
EPS Forecast (FY)0.23
Revenue Forecast (FY)C$106.71M
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 Sutton, Mr. Lube + Tires, Loyalty Inc., Mr. Mikes, Nurse Next Doo...
How the Company Makes Money
DIV makes money primarily by receiving royalty revenue calculated as a contractually defined percentage of the system-wide sales (or other defined revenue base) generated by the underlying brand(s) in which it holds royalty interests. These royalt...
Diversified Royalty Corp Financial Statement Overview
Summary
Income Statement
84
Very Positive
Balance Sheet
66
Positive
Cash Flow
54
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 72.65M | 70.79M | 64.99M | 56.49M | 45.18M | 37.28M |
| Gross Profit | 72.60M | 70.69M | 64.89M | 56.40M | 42.91M | 35.31M |
| EBITDA | 64.42M | 68.48M | 55.21M | 58.77M | 33.36M | 41.16M |
| Net Income | 36.26M | 36.67M | 26.62M | 31.72M | 15.56M | 23.52M |
Balance Sheet | ||||||
| Total Assets | 656.70M | 612.25M | 578.98M | 567.35M | 458.45M | 380.76M |
| Cash, Cash Equivalents and Short-Term Investments | 46.49M | 4.61M | 19.69M | 4.03M | 7.41M | 8.94M |
| Total Debt | 298.45M | 256.15M | 260.47M | 305.16M | 199.78M | 169.66M |
| Total Liabilities | 367.10M | 323.66M | 290.18M | 329.95M | 224.56M | 189.24M |
| Stockholders Equity | 289.61M | 288.59M | 288.80M | 237.40M | 233.89M | 191.53M |
Cash Flow | ||||||
| Free Cash Flow | -6.54M | 45.41M | 46.48M | -46.41M | -50.93M | 10.86M |
| Operating Cash Flow | 42.98M | 45.42M | 46.49M | 30.82M | 28.38M | 27.82M |
| Investing Cash Flow | -49.52M | -49.51M | -8.00K | -77.22M | -79.31M | -16.96M |
| Financing Cash Flow | 38.17M | -10.53M | -30.77M | 43.05M | 49.37M | -11.14M |
Diversified Royalty Corp Technical Analysis
Neutral
4.33
Price Trends
4.63
Negative
4.37
Positive
3.97
Positive
Market Momentum
>-0.01
Positive
43.75
Neutral
17.68
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:DIV, the sentiment is Neutral. The current price of 4.33 is below the 20-day moving average (MA) of 4.76, below the 50-day MA of 4.63, and above the 200-day MA of 3.97, indicating a neutral trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 43.75 is Neutral, neither overbought nor oversold. The STOCH value of 17.68 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:DIV.
Diversified Royalty Corp Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | C$879.44M | 19.01 | 16.00% | 3.02% | 6.54% | 44.56% | |
71 Outperform | C$790.06M | 21.49 | 12.54% | 7.14% | 10.83% | 30.66% | |
67 Neutral | C$684.60M | 11.10 | 11.63% | 5.09% | -3.59% | 50.73% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
63 Neutral | C$581.32M | 28.85 | 7.12% | 3.43% | 44.38% | -7.06% | |
61 Neutral | C$933.19M | 27.59 | 10.35% | 1.98% | 11.71% | 76473.68% | |
52 Neutral | C$199.25M | 36.91 | 9.17% | 7.88% | 9.61% | 81.06% |
* Industrials Sector Average
TSE:DIV
Diversified Royalty Corp
4.62
1.54
50.15%
TSE:CGY
Calian Group
80.81
31.45
63.73%
TSE:DE
Decisive Dividend
9.33
1.95
26.46%
TSE:DXT
Dexterra Group
14.07
4.97
54.56%
TSE:KBL
K-Bro Linen
45.92
12.43
37.13%
TSE:WJX
Wajax Corporation
31.85
9.92
45.23%
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.