PrairieSky Royalty (TSE:PSK)
TSX:PSK
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PrairieSky Royalty
(TSX:PSK)
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Rating:76Outperform
Price Target:
C$37.00
▲(11.41% Upside)
Action:ReiteratedDate:03/26/26
The score is driven primarily by strong underlying financial quality (high profitability and low leverage) and a positive earnings-call outlook with shareholder-return actions. Technicals are supportive with an established uptrend, while the biggest offset is valuation pressure from a high P/E (partly cushioned by the dividend yield) and the company’s noted cash flow/commodity sensitivity.
Positive Factors
Very high operating margins
PrairieSky’s royalty model yields extremely high operating margins because it receives production value without funding drilling or most operating costs. Persistently high margins support durable cash conversion, underpin dividends and buybacks, and provide resilience through commodity cycles.
Negative Factors
High commodity and FX sensitivity
Royalty cash flows scale directly with commodity prices and FX. The provided sensitivities show multi‑tens of millions swing per unit move, producing structural volatility in FFO and distributable cash that can affect dividend visibility and capital allocation over multi‑month horizons.
Read all positive and negative factors
Positive Factors
Negative Factors
Very high operating margins
PrairieSky’s royalty model yields extremely high operating margins because it receives production value without funding drilling or most operating costs. Persistently high margins support durable cash conversion, underpin dividends and buybacks, and provide resilience through commodity cycles.
Read all positive factors
PrairieSky Royalty (PSK) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$7.72B
Dividend Yield3.76%
Average Volume (3M)339.52K
Price to Earnings (P/E)30.7
Beta (1Y)0.59
Revenue Growth-1.59%
EPS Growth0.09%
CountryCA
Employees75
SectorEnergy
Sector Strength52
IndustryOil & Gas Exploration & Production
Share Statistics
EPS (TTM)0.19
Shares Outstanding232,579,400
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$33.32Price Target Upside0.32% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
EPS Forecast (FY)1.1
Revenue Forecast (FY)C$475.33M
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 primarily makes money through (1) royalty revenue and (2) other consideration received for granting mineral rights.
1) Royalty revenue (core recurring cash flow):
- PrairieSky grants exploration and production (E&P) companies the right...
PrairieSky Royalty Earnings Call Summary
Earnings Call Date:Feb 09, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 20, 2026
Earnings Call Sentiment Positive
The call conveyed a largely positive operational and financial picture: record oil production, material YoY growth in key plays (Duvernay +90%, Clearwater reserves +42%), strong drilling activity on PSK lands, healthy margins (~98%), active capital allocation including $100M of accretive acquisitions and share cancellations, and an increased dividend. The primary negatives were operational volatility from pad timing and high-decline new wells, a small dip in average royalty rate, and meaningful sensitivity to commodity and FX movements. On balance, the favorable growth, returns, and capital actions substantially outweigh the operational timing risks and sensitivity exposures.Positive Updates
Record Oil Production
Oil royalty production reached a record annual average of 13,940 barrels per day in 2025, up 6% year-over-year; Q4 averaged 13,750 bpd.
Negative Updates
Quarterly Volume Volatility
Production exhibited volatility with a Q3 pad-driven spike followed by declines in Q4; management noted timing-staggered well additions will create short-term volume variability through 2026.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Oil Production
Oil royalty production reached a record annual average of 13,940 barrels per day in 2025, up 6% year-over-year; Q4 averaged 13,750 bpd.
Read all positive updates
Company Guidance
The company guided toward further records in 2026, reiterating a focus on leasing its undeveloped land and buybacks when out of blackout, and provided numerous metrics: 2025 oil up 6% to a record 13,940 bbl/d (Q4 13,750 bpd), PDP reserves +7% YoY, Clearwater 2P reserves +42% YoY and Clearwater CAGR 20% since 2022 with half of volumes under waterflood, Duvernay royalty production +90% YoY and expected to be the fastest-growing play in 2026, 2025 drilling: ~$2.0B third‑party capex on PSK lands (8.3% of basin conventional CapEx, vs 6.9% in 2024), 80 multi‑lateral spuds in Q4 and 285 in 2025 (40% of activity, up from 36%), 189 leases with 90 counterparties, $100M acquisitions, 2.6% shares canceled, $243.4M dividends paid, 2% dividend increase to $1.06/year ($0.265 quarterly from Mar 31, 2026), 98% operating margins, NGL Q4 2,915 bpd (+17% Q/Q, +5% YoY) with ~35% pentanes/condensate (~1,000 bpd), total production 64% liquids, royalty revenue $102.9M Q / $441.7M Y (94% liquids), other revenue $8.8M Q / $36.5M Y, FFO $80.5M ($0.35)/Q and $353M ($1.50)/Y, 2026 sensitivities: $5/bbl WTI → ±$24.5M FFO, $1 differential → ±$5.5M, $0.25/Mcf AECO → ±$4M, $0.01 USD/CAD → ±$4M, and tax pools of $1.18B (first $118M of cash flow tax‑free, incremental tax 23.5%; 2025 dividends = 44% return of capital for U.S. investors).PrairieSky Royalty Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
86
Very Positive
Cash Flow
70
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 478.20M | 470.30M | 479.60M | 619.30M | 293.60M |
| Gross Profit | 323.30M | 466.40M | 473.20M | 612.70M | 290.00M |
| EBITDA | 432.80M | 439.80M | 455.50M | 580.20M | 264.60M |
| Net Income | 205.00M | 215.30M | 227.60M | 317.50M | 123.30M |
Balance Sheet | |||||
| Total Assets | 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 |
| Total Debt | 242.50M | 95.50M | 188.10M | 219.20M | 645.00M |
| Total Liabilities | 604.50M | 465.70M | 541.30M | 647.10M | 915.80M |
| Stockholders Equity | 2.54B | 2.74B | 2.77B | 2.77B | 2.59B |
Cash Flow | |||||
| Free Cash Flow | 257.50M | 363.60M | 306.50M | 552.00M | -206.30M |
| Operating Cash Flow | 357.40M | 378.60M | 318.90M | 565.50M | 252.00M |
| Investing Cash Flow | -99.20M | -49.10M | -57.90M | -30.60M | -986.40M |
| Financing Cash Flow | -258.20M | -329.50M | -261.00M | -534.90M | 734.40M |
PrairieSky Royalty Technical Analysis
Positive
33.21
Price Trends
30.44
Positive
28.63
Positive
26.43
Positive
Market Momentum
0.67
Negative
68.22
Neutral
68.63
Neutral
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 33.21 is above the 20-day moving average (MA) of 31.89, above the 50-day MA of 30.44, and above the 200-day MA of 26.43, indicating a bullish trend. The MACD of 0.67 indicates Negative momentum. The RSI at 68.22 is Neutral, neither overbought nor oversold. The STOCH value of 68.63 is Neutral, 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$5.13B | 14.32 | 27.19% | ― | 3.04% | 115.77% | |
78 Outperform | C$5.50B | 10.89 | 15.30% | 5.77% | 11.52% | 24.76% | |
76 Outperform | C$7.72B | 30.68 | 7.90% | 3.76% | -1.59% | 0.09% | |
70 Outperform | C$9.03B | -15.31 | 15.77% | 2.99% | -11.41% | 40.81% | |
68 Neutral | C$5.67B | -110.02 | -1.84% | 1.91% | -1.36% | -149.45% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
65 Neutral | C$2.89B | 27.14 | 8.82% | 7.05% | 2.52% | -8.32% |
* Energy Sector Average
TSE:PSK
PrairieSky Royalty
33.21
7.80
30.69%
TSE:ATH
Athabasca Oil
10.69
5.11
91.58%
TSE:TVE
Tamarack Valley Energy
11.67
7.41
173.82%
TSE:FRU
Freehold Royalties
17.64
5.77
48.58%
TSE:PEY
Peyto Exploration & Dev
26.85
9.67
56.26%
TSE:SCR
Strathcona Resources
42.17
21.06
99.77%
PrairieSky Royalty Corporate Events
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 ...
Financial DisclosuresRegulatory Filings and Compliance
PrairieSky Royalty Sets February Date for Q4 and Year-End 2025 Results
Neutral
Jan 14, 2026
PrairieSky Royalty Ltd. will release its fourth-quarter and year-end 2025 financial and operating results after markets close on February 9, 2026, followed by a conference call for the investment community on February 10, 2026. The company will ma...
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.