Topaz Energy Corp (TSE:TPZ)
TSX:TPZ
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Topaz Energy Corp
(TSX:TPZ)
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Rating:70Outperform
Price Target:
C$34.00
▲(9.36% Upside)
Action:UpgradedDate:02/27/26
The score is primarily supported by strong profitability and manageable leverage, reinforced by a positive earnings-call outlook and guidance. Offsetting factors are the sharp recent revenue decline and free-cash-flow volatility, plus a relatively expensive valuation (high P/E) and technically overextended momentum signals.
Positive Factors
Asset-light royalty model
An asset-light royalty model reduces capital and operating expenditure requirements, lowering cyclical exposure and permitting scalable cash returns. By collecting contractually defined production shares while operators fund development, Topaz preserves cash flexibility to pay dividends and pursue selective acquisitions over time.
Negative Factors
Reliance on operator-funded activity
Topaz’s growth depends heavily on the capital allocation and drilling plans of a limited set of operators. This concentration means Topaz cannot directly control drilling cadence or capex; a shift in operator priorities or reduced spending could materially depress royalty production and long-term revenue growth.
Read all positive and negative factors
Positive Factors
Negative Factors
Asset-light royalty model
An asset-light royalty model reduces capital and operating expenditure requirements, lowering cyclical exposure and permitting scalable cash returns. By collecting contractually defined production shares while operators fund development, Topaz preserves cash flexibility to pay dividends and pursue selective acquisitions over time.
Read all positive factors
Topaz Energy Corp (TPZ) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$4.67B
Dividend Yield4.91%
Average Volume (3M)436.91K
Price to Earnings (P/E)32.9
Beta (1Y)0.58
Revenue Growth6.52%
EPS Growth-13.92%
CountryCA
Employees8
SectorEnergy
Sector Strength52
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)0.21
Shares Outstanding154,500,000
10 Day Avg. Volume598,842
30 Day Avg. Volume436,906
Financial Highlights & Ratios
PEG Ratio0.20
Price to Book (P/B)2.79
Price to Sales (P/S)13.04
P/FCF Ratio13.96
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$33.15Price Target Upside6.63% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering11
EPS Forecast (FY)0.97
Revenue Forecast (FY)C$398.00M
Topaz Energy Corp Business Overview & Revenue Model
Company Description
Topaz Energy Corp. operates as a royalty and energy infrastructure company. It operates in Royalty Production and Infrastructure segments. The company holds gross overriding royalty interests on approximately 5.3 million gross acres of developed a...
How the Company Makes Money
Topaz Energy Corp generates revenue primarily through the sale of crude oil, natural gas, and natural gas liquids produced from its operational sites. The company's revenue model is built on long-term contracts and spot market sales, allowing for ...
Topaz Energy Corp Earnings Call Summary
Earnings Call Date:Feb 24, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 05, 2026
Earnings Call Sentiment Positive
The call conveyed predominantly positive operational and financial momentum: strong production growth (17% y/y), reserve additions (+10% proved+probable), robust operator-funded drilling and well activity, improved cash flow and a substantial net income increase (64% in Q4). Management provided constructive 2026 guidance with targeted production, processing revenue, and a manageable leverage target (1.2x net debt-to-EBITDA). Key risks noted include reliance on operator-funded activity, reserve-report scope limitations (excludes undeveloped locations), a relatively high payout ratio (~66–68%), and some short-term M&A and rig-activity uncertainty. Overall, the highlights materially outweigh the lowlights.Positive Updates
Royalty Production Growth
Full-year 2025 royalty production averaged 22,400 boe/d, up 17% year-over-year; Q4 2025 royalty production averaged 23,400 boe/d, up 15% from Q4 2024, driven by record oil and liquids production of 6,900 bbl/d. Liquids production rose ~11% and natural gas production rose ~19% year-over-year.
Negative Updates
Reliance on Operator-Funded Activity
Topaz’s growth and reserve additions were primarily driven by operator-funded capital (estimated $2.8 billion). This reliance concentrates exposure to the development plans and capital allocation decisions of a few operators (notably Headwater and Tamarack).
Read all updates
Q4-2025 Updates
Positive
Negative
Royalty Production Growth
Full-year 2025 royalty production averaged 22,400 boe/d, up 17% year-over-year; Q4 2025 royalty production averaged 23,400 boe/d, up 15% from Q4 2024, driven by record oil and liquids production of 6,900 bbl/d. Liquids production rose ~11% and natural gas production rose ~19% year-over-year.
Read all positive updates
Company Guidance
Topaz’s 2026 guidance targets average royalty production of 23,500–23,900 boe/d, processing revenue and other income of $92–$94 million, an expected exit-year net debt-to-EBITDA of 1.2x and a 68% dividend payout ratio; management says that 68% payout remains sustainable through year‑end 2026 even at $0 AECO and US$55 WTI thanks to fixed infrastructure revenue and hedging contracts, and it expects to maintain roughly 27–30 active drilling rigs on its royalty acreage through Q1 2026.Topaz Energy Corp Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
72
Positive
Cash Flow
66
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 324.72M | 312.40M | 321.42M | 369.65M | 211.54M |
| Gross Profit | 182.86M | 305.05M | 314.52M | 363.27M | 207.29M |
| EBITDA | 300.04M | 293.00M | 316.13M | 351.45M | 193.01M |
| Net Income | 128.74M | 46.39M | 47.64M | 99.36M | 27.56M |
Balance Sheet | |||||
| Total Assets | 2.24B | 1.94B | 1.70B | 1.89B | 1.67B |
| Cash, Cash Equivalents and Short-Term Investments | 580.00K | 147.00K | 3.46M | 0.00 | 0.00 |
| Total Debt | 570.77M | 540.40M | 391.64M | 464.58M | 276.86M |
| Total Liabilities | 723.35M | 627.64M | 460.41M | 532.40M | 346.97M |
| Stockholders Equity | 1.52B | 1.32B | 1.24B | 1.36B | 1.32B |
Cash Flow | |||||
| Free Cash Flow | 303.50M | -161.63M | 246.03M | -36.81M | 162.24M |
| Operating Cash Flow | 308.76M | 276.27M | 300.58M | 317.88M | 165.02M |
| Investing Cash Flow | -132.19M | -439.99M | -51.96M | -354.10M | -921.40M |
| Financing Cash Flow | -176.14M | 160.41M | -245.16M | 36.22M | 536.20M |
Topaz Energy Corp Technical Analysis
Neutral
31.09
Price Trends
29.95
Positive
28.43
Positive
26.54
Positive
Market Momentum
0.28
Positive
43.28
Neutral
28.76
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TPZ, the sentiment is Neutral. The current price of 31.09 is below the 20-day moving average (MA) of 31.33, above the 50-day MA of 29.95, and above the 200-day MA of 26.54, indicating a neutral trend. The MACD of 0.28 indicates Positive momentum. The RSI at 43.28 is Neutral, neither overbought nor oversold. The STOCH value of 28.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TSE:TPZ.
Topaz Energy Corp Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | C$35.32B | 17.93 | 9.91% | 5.44% | 2.81% | -14.92% | |
70 Outperform | C$4.67B | 32.90 | 9.77% | 4.91% | 6.52% | -13.92% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
64 Neutral | C$5.04B | 20.80 | 16.47% | 6.61% | -12.18% | -29.17% | |
61 Neutral | C$12.04B | 23.33 | 15.39% | 4.81% | -4.09% | -3.57% | |
54 Neutral | C$2.90B | 26.86 | 14.09% | 0.43% | 50.38% | 25.63% | |
53 Neutral | C$188.16M | -1.01 | -49.98% | ― | -23.30% | 76.16% |
* Energy Sector Average
TSE:TPZ
Topaz Energy Corp
31.09
8.49
37.58%
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TSE:TWM
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65.45%
Topaz Energy Corp Corporate Events
Business Operations and StrategyDividendsFinancial Disclosures
Topaz Energy Lifts Reserves, Free Cash Flow and Dividend as It Sets 2026 Outlook
Positive
Feb 24, 2026
Topaz Energy Corp. reported strong 2025 results, highlighted by 17% higher royalty production, 20% higher infrastructure revenue, sharply lower cash expenses and record free cash flow margins, which supported higher cash flow and earnings per shar...
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.