Which Royalty and Streaming Companies Analysts Are Watching
Performances of royalty and streaming companies
Royalty and streaming companies have slightly outperformed the benchmark index (GDX) as a group in 1Q17. They rose 9.8% in 1Q17 against GDX’s rise of 9.0%. There isn’t much divergence in the price performances of individual companies in this group.
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Royal Gold (RGLD) is the top-performing royalty company with a quarterly rise of 10.6%. Next is Franco-Nevada (FNV) with a rise of 9.6% and Sandstorm Gold (SAND) with a rise of 9.5%. Silver Wheaton (SLW) has slightly underperformed with a rise of 7.9% during the quarter.
Ratings for royalty companies
Royalty and streaming companies are more stable since their cash flows are more predictable than cash flows for miners. This stability is probably why analysts currently don’t have any “sell” ratings for any of these stocks.
Silver Wheaton seems to be analysts’ favorite stock in this space. It has 85.0% “buy” ratings and 15.0% “hold” ratings. Royal Gold follows with 77.0% “buy” ratings.
Changes in ratings
Analysts’ ratings have changed the most for Franco-Nevada in the last year. While the company had 33.0% “buy” ratings in September 2016, it had only 13.0% “buy” ratings in April 2017.
All the streaming companies have upside potentials based on their target prices. Silver Wheaton has an upside potential of 33.0%, while Franco-Nevada could rise 3.3.0% based on analysts’ average target price.
In the next part of this series, we’ll take a look at recent key ratings changes for royalty and streaming companies.