Topaz Energy Corp (TSE:TPZ)
TSX:TPZ
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Topaz Energy Corp
(TSX:TPZ)
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Rating:73Outperform
Price Target:
C$36.00
▲(21.62% Upside)
Action:Reiterated
Date:06/04/26
The score is driven mainly by strong profitability and improving returns, supported by a clear positive price trend. The key offsets are uneven multi-year revenue/free-cash-flow consistency and a relatively high P/E despite a solid dividend yield.
Positive Factors
Asset-light royalty model
Topaz's asset-light royalty business converts third-party drilling and production into contractually defined cash flows without bearing full operating or development capex. Over 2–6 months this structural model supports capital efficiency, lower operational risk, and scalable growth via acquisitions of additional royalty interests.
Negative Factors
Uneven revenue and FCF history
Historical swings in revenue and episodes of negative free cash flow reflect sensitivity to timing of acquisitions, capital timing or working-capital swings. This unevenness undermines predictability of cash available for distributions or acquisitions and increases execution risk over a multi-month horizon.
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Positive Factors
Negative Factors
Asset-light royalty model
Topaz's asset-light royalty business converts third-party drilling and production into contractually defined cash flows without bearing full operating or development capex. Over 2–6 months this structural model supports capital efficiency, lower operational risk, and scalable growth via acquisitions of additional royalty interests.
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)31.1
Beta (1Y)0.46
Revenue Growth4.94%
EPS Growth93.71%
CountryCA
Employees8
SectorEnergy
Sector Strength52
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)0.97
Shares Outstanding154,800,000
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$34.90Price Target Upside17.91% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
EPS Forecast (FY)1.55
Revenue Forecast (FY)C$391.00M
Topaz Energy Corp Business Overview & Revenue Model
Company Description
Topaz Energy Corp. operates as an entity primarily focused on energy royalties and infrastructure, segmenting its operations into Royalty Production and Infrastructure. The company maintains substantial gross overriding royalty interests, spanning...
How the Company Makes Money
Topaz primarily makes money by earning royalty revenue tied to oil and natural gas production from properties where it owns royalty interests (or similar non-operated interests). Under these arrangements, operating companies drill, develop, and pr...
Topaz Energy Corp Earnings Call Summary
Earnings Call Date:Feb 24, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Jul 27, 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).
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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
78
Positive
Balance Sheet
74
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 328.70M | 324.72M | 312.40M | 321.42M | 369.65M | 211.54M |
| Gross Profit | 183.27M | 182.86M | 305.05M | 314.52M | 363.27M | 207.29M |
| EBITDA | 360.88M | 333.16M | 293.00M | 316.13M | 351.45M | 193.01M |
| Net Income | 150.49M | 128.74M | 46.39M | 47.64M | 99.36M | 27.56M |
Balance Sheet | ||||||
| Total Assets | 2.20B | 2.24B | 1.94B | 1.70B | 1.89B | 1.67B |
| Cash, Cash Equivalents and Short-Term Investments | 997.00K | 580.00K | 147.00K | 3.46M | 0.00 | 0.00 |
| Total Debt | 539.91M | 570.77M | 540.40M | 391.64M | 464.58M | 276.86M |
| Total Liabilities | 697.23M | 723.35M | 627.64M | 460.41M | 532.40M | 346.97M |
| Stockholders Equity | 1.51B | 1.52B | 1.32B | 1.24B | 1.36B | 1.32B |
Cash Flow | ||||||
| Free Cash Flow | 279.61M | 303.50M | -161.63M | 246.03M | -36.81M | 162.24M |
| Operating Cash Flow | 311.43M | 308.76M | 276.27M | 300.58M | 317.88M | 165.02M |
| Investing Cash Flow | -113.92M | -132.19M | -439.99M | -51.96M | -354.10M | -921.40M |
| Financing Cash Flow | -196.51M | -176.14M | 160.41M | -245.16M | 36.22M | 536.20M |
Topaz Energy Corp Technical Analysis
Negative
29.60
Price Trends
31.31
Negative
30.60
Negative
28.16
Positive
Market Momentum
-0.27
Positive
34.28
Neutral
14.33
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:TPZ, the sentiment is Negative. The current price of 29.6 is below the 20-day moving average (MA) of 31.72, below the 50-day MA of 31.31, and above the 200-day MA of 28.16, indicating a neutral trend. The MACD of -0.27 indicates Positive momentum. The RSI at 34.28 is Neutral, neither overbought nor oversold. The STOCH value of 14.33 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 |
|---|---|---|---|---|---|---|---|
73 Outperform | C$4.67B | 31.07 | 10.95% | 4.91% | 4.94% | 93.71% | |
71 Outperform | C$38.08B | 22.41 | 9.98% | 5.44% | -5.92% | -12.92% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
60 Neutral | C$2.65B | 35.84 | 9.99% | 0.43% | 65.16% | -18.37% | |
59 Neutral | C$15.93B | 71.27 | 6.59% | 4.81% | -11.59% | -67.03% | |
54 Neutral | C$5.10B | 33.51 | 16.60% | 6.61% | -4.83% | -9.94% | |
50 Neutral | C$362.64M | -3.33 | -54.09% | ― | -7.72% | -127.37% |
* Energy Sector Average
TSE:TPZ
Topaz Energy Corp
30.15
5.83
23.99%
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TSE:GEI
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29.56
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32.44%
TSE:KEY
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56.46
14.29
33.89%
TSE:TVK
TerraVest
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TSE:TWM
Tidewater Midstream and Infrastructure
16.60
12.40
295.24%
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.