PrairieSky Royalty (TSE:PSK)
TSX:PSK
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PrairieSky Royalty
(TSX:PSK)
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Rating:73Outperform
Price Target:
C$35.00
▲(13.45% Upside)
Action:Reiterated
Date:04/22/26
The score is driven primarily by strong financial quality (high profitability, low leverage, and robust cash generation) and a constructive earnings update (FFO and production growth, strong Duvernay activity). Offsetting this are a relatively expensive valuation (high P/E with modest yield) and only moderate/neutral technical momentum in the near term.
Positive Factors
High Profitability
PrairieSky's ~43% net margin reflects its royalty business model which avoids operating and development costs. These structurally higher margins generate durable operating cash and provide a buffer through cycles, supporting sustained dividends and capital returns over time.
Negative Factors
Choppy Growth & Free Cash Flow Volatility
Historical swings in free cash flow and inconsistent revenue growth reduce predictability of distributions and reinvestment. Intermittent negative FCF years and year-to-year variability make multi‑period planning and steady capital return guidance harder to rely on.
Read all positive and negative factors
Positive Factors
Negative Factors
High Profitability
PrairieSky's ~43% net margin reflects its royalty business model which avoids operating and development costs. These structurally higher margins generate durable operating cash and provide a buffer through cycles, supporting sustained dividends and capital returns over time.
Read all positive factors
PrairieSky Royalty (PSK) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$8.06B
Dividend Yield3.76%
Average Volume (3M)339.52K
Price to Earnings (P/E)33.6
Beta (1Y)0.42
Revenue Growth-6.33%
EPS Growth-8.64%
CountryCA
Employees75
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)0.87
Shares Outstanding232,442,550
10 Day Avg. Volume379,332
30 Day Avg. Volume339,519
Financial Highlights & Ratios
PEG Ratio-9.20
Price to Book (P/B)2.47
Price to Sales (P/S)13.15
P/FCF Ratio24.43
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$35.46Price Target Upside14.96% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)1.31
Revenue Forecast (FY)C$484.00M
PrairieSky Royalty Business Overview & Revenue Model
Company Description
PrairieSky Royalty Ltd. holds crude oil and natural gas royalty interests in Alberta, Saskatchewan, British Columbia, and Manitoba of Canada. It holds an interest in approximately 9.8 million acres with petroleum and/or natural gas rights; 8.5 mil...
How the Company Makes Money
PrairieSky makes money primarily by collecting royalties on petroleum and natural gas produced from lands where it owns mineral rights or holds royalty interests. Under its leasing arrangements, operating E&P companies fund and execute drilling an...
PrairieSky Royalty Earnings Call Summary
Earnings Call Date:Apr 20, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 13, 2026
Earnings Call Sentiment Positive
The call conveyed a generally positive operational and financial tone: FFO grew 11%, production increased across key streams, Duvernay and Clearwater showed strong outperformance, and leasing activity accelerated. Management is returning capital via dividends and repurchases while signaling potential for meaningful debt reduction later in 2026. Risks noted included a transitory thermal decline that impacted quarterly volumes, the lumpy/non‑repeatable nature of lease bonuses, and sensitivity of activity and balance‑sheet progress to commodity prices and FX. On balance the positives — strong production growth, record Duvernay activity, rising leasing, and solid FFO — outweigh near‑term challenges and execution risks.Positive Updates
Funds from Operations and Revenue Growth
Funds from operations (FFO) of $94.9 million, an 11% increase versus Q1 2025, or $0.41 per share. Royalty revenue of $118.5 million and other revenue of $15.3 million for the quarter.
Negative Updates
Transitory Thermal Decline Impacting Quarter‑over‑Quarter Volumes
A ~200 bbl/d net decline from the Lindbergh thermal project was cited as a primary driver of a slight quarter‑over‑quarter volume decline; management characterized this as transitory but it impacted near‑term comparatives.
Read all updates
Q1-2026 Updates
Positive
Negative
Funds from Operations and Revenue Growth
Funds from operations (FFO) of $94.9 million, an 11% increase versus Q1 2025, or $0.41 per share. Royalty revenue of $118.5 million and other revenue of $15.3 million for the quarter.
Read all positive updates
Company Guidance
PrairieSky guided to a strong start to 2026 with Q1 funds from operations of $94.9M (up 11% Y/Y; $0.41/share), royalty revenue of $118.5M and other revenues of $15.3M, supported by total production +4% Y/Y (oil +2%, NGLs +6% with condensate/pentane ~35% of the NGL stream); activity metrics included 201 spuds on PrairieSky lands versus 200 a year ago, 48 new leasing arrangements with 37 companies generating $12.3M of lease bonus (more than double Q1 last year), a record 26 Duvernay spuds (20 in the West Shale Basin), 66 multilateral spuds (vs 41), Mannville oil >1,000 bbl/d in Q1, Clearwater oil ~+20% Y/Y and Duvernay oil ~+75% Y/Y. Capital allocation in Q1 included $61.6M of dividends (65% payout ratio) and a Q2 dividend of $0.265/share, $4.2M of acquisitions, $8.3M of NCIB repurchases (269,000 shares), and $6M of debt reduction to finish the quarter with net debt of $257.7M; management expects mid‑single‑digit oil growth for the year, material debt reduction by end‑2026 (per strip pricing), meaningful Duvernay payments in H2, and that current inventory can replace ~9.5M barrels of royalty production for ~61 years.PrairieSky Royalty Financial Statement Overview
Summary
Income Statement
83
Very Positive
Balance Sheet
88
Very Positive
Cash Flow
79
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 472.80M | 478.20M | 470.30M | 479.60M | 619.30M | 293.60M |
| Gross Profit | 358.40M | 323.30M | 466.40M | 473.20M | 612.70M | 290.00M |
| EBITDA | 429.70M | 432.80M | 439.80M | 455.50M | 580.20M | 264.60M |
| Net Income | 202.40M | 205.00M | 215.30M | 227.60M | 317.50M | 123.30M |
Balance Sheet | ||||||
| Total Assets | 3.16B | 3.15B | 3.21B | 3.31B | 3.42B | 3.51B |
| Cash, Cash Equivalents and Short-Term Investments | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 |
| Total Debt | 236.70M | 242.50M | 95.50M | 188.10M | 219.20M | 645.00M |
| Total Liabilities | 630.60M | 604.50M | 465.70M | 541.30M | 647.10M | 915.80M |
| Stockholders Equity | 2.53B | 2.54B | 2.74B | 2.77B | 2.77B | 2.59B |
Cash Flow | ||||||
| Free Cash Flow | 317.10M | 257.50M | 363.60M | 306.50M | 552.00M | -206.30M |
| Operating Cash Flow | 345.90M | 357.40M | 378.60M | 318.90M | 565.50M | 252.00M |
| Investing Cash Flow | -39.80M | -99.20M | -49.10M | -57.90M | -30.60M | -986.40M |
| Financing Cash Flow | -306.10M | -258.20M | -329.50M | -261.00M | -534.90M | 734.40M |
PrairieSky Royalty Technical Analysis
Positive
30.85
Price Trends
32.53
Positive
30.55
Positive
27.75
Positive
Market Momentum
0.65
Negative
66.53
Neutral
81.68
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:PSK, the sentiment is Positive. The current price of 30.85 is below the 20-day moving average (MA) of 33.57, below the 50-day MA of 32.53, and above the 200-day MA of 27.75, indicating a bullish trend. The MACD of 0.65 indicates Negative momentum. The RSI at 66.53 is Neutral, neither overbought nor oversold. The STOCH value of 81.68 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:PSK.
PrairieSky Royalty Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | C$5.41B | 8.13 | 16.78% | 5.77% | 29.94% | 57.11% | |
73 Outperform | C$8.06B | 33.57 | 7.89% | 3.76% | -6.33% | -8.64% | |
73 Outperform | C$5.81B | 29.25 | 12.23% | ― | -4.92% | -52.64% | |
73 Outperform | C$2.92B | 20.28 | 8.81% | 7.05% | -7.99% | -44.67% | |
70 Outperform | C$10.46B | 57.81 | 13.89% | 2.99% | -24.78% | 5.03% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
60 Neutral | C$6.28B | 246.51 | -5.03% | 1.91% | -5.38% | -139.64% |
* Energy Sector Average
TSE:PSK
PrairieSky Royalty
34.69
12.37
55.44%
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TSE:SCR
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135.43%
PrairieSky Royalty Corporate Events
Financial Disclosures
PrairieSky Royalty Sets April 20 Date to Unveil Q1 2026 Results
Neutral
Mar 30, 2026
PrairieSky Royalty Ltd. plans to release its first-quarter 2026 financial and operating results after markets close on April 20, 2026, with full financial statements and management’s discussion and analysis to be posted on its website and on...
Business Operations and StrategyStock BuybackDividendsFinancial Disclosures
PrairieSky Lifts Dividend as Record Oil Royalties Offset Weaker Prices
Positive
Feb 9, 2026
PrairieSky Royalty raised its annual dividend policy by 2% to $1.06 per share following a year of record oil royalty production and continued reserve growth, underscoring confidence in its long-term cash flow profile. The company also reduced net ...
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.