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Royal Gold (RGLD) Up 6.7% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Royal Gold (RGLD - Free Report) . Shares have added about 6.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Royal Gold due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Royal Gold Earnings Miss, Sales Beat Estimates in Q4
Royal Gold’s adjusted earnings per share was 45 cents in fourth-quarter fiscal 2019, which missed the Zacks Consensus Estimate of 48 cents. However, the bottom line improved 10% from the prior-year quarter’s earnings per share of 41 cents.
The company generated revenues of $115.7 million compared with the $116.2 million reported in the year-ago quarter. The top-line figure, however, surpassed the Zacks Consensus Estimate $112 million. Stream revenues came in at $90.3 million, up from the year-ago quarter’s $83.5 million, driven by increased stream sales from Mount Milligan, Andacollo, Wassa and Rainy River mines. Nonetheless, this upside was partly offset by lower gold and silver sales from the Pueblo Viejo mine. Further, royalty revenues declined to $25.4 million from the prior-year quarter’s $32.7 million, due to a revenue fall in the Peñasquito mine. Nevertheless, reduced royalty revenues were partly muted by an increase in revenues from the Cortez royalty interests.
Operational Highlights
Royal Gold’s volume of 88,400 GEOs (Gold Equivalent Ounces) edged down 0.7% from the year-earlier quarter. Average gold price was up 0.2% to $1,309 per ounce from the year-ago quarter.
The company reported cost of sales of $23.8 million in the reported quarter, up from the year-ago quarter’s $22.2 million. General and administrative expenses slipped to $6.4 million from the prior fiscal year’s $10.9 million. Operating profit came in at $40.7 million, up from the $36.2 million reported in the comparable period last year.
FY19 Performance
Royal Gold’s adjusted earnings per share came in at $1.43 in fiscal 2019, missing the Zacks Consensus Estimate of $1.60. The company had reported a loss of $1.73 per share in fiscal 2018.
Fiscal 2019 revenues came in at $423.1 million compared with the prior fiscal year’s $459 million. Further, the revenue figure missed the Zacks Consensus Estimate of $424.9 million. This downside resulted from a drop in stream revenues, and lower average gold, silver and copper prices.
Financial Position
Net cash provided by operating activities was $253 million in fiscal 2019 compared with $329 million in fiscal 2018. The company ended the fiscal year with $119 million cash in hand, up from $89 million reported at the end of fiscal 2018. As of the end of fiscal 2019, the company’s total debt was around $215 million, down from the $351 million recorded at the end of fiscal 2018. The company paid dividends worth $67.5 million during the fiscal year.
Recent Developments
This July, Cupric, the majority owner of Khoemacau Copper Mining, announced closing the project financing for development of the Khoemacau Copper Silver Project in Botswana. Cupric has added $85 million of equity to the project financing, bringing the total available funding to $650 million.
On Feb 27, Centerra Gold Inc. received an amendment to the Mount Milligan environmental assessment certificate that permits access to additional sources of surface water and groundwater. Mount Milligan commenced accessing water from the newly-permitted sources in the beginning of April 2019. Average mill throughput for the fiscal fourth quarter was 53,559 tons per calendar day, with an average throughput of 60,576 tons per calendar day during June. Despite dry weather conditions, Centerra reaffirmed Mount Milligan’s production guidance for the 2019 calendar year, consisting of payable gold production of 155,000-175,000 ounces and payable copper production of 65-75 million.
How Have Estimates Been Moving Since Then?
Fresh estimates followed an upward path over the past two months. The consensus estimate has shifted 8.33% due to these changes.
VGM Scores
At this time, Royal Gold has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of F on the value side, putting it in the fifth quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Royal Gold has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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Royal Gold (RGLD) Up 6.7% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Royal Gold (RGLD - Free Report) . Shares have added about 6.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Royal Gold due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Royal Gold Earnings Miss, Sales Beat Estimates in Q4
Royal Gold’s adjusted earnings per share was 45 cents in fourth-quarter fiscal 2019, which missed the Zacks Consensus Estimate of 48 cents. However, the bottom line improved 10% from the prior-year quarter’s earnings per share of 41 cents.
The company generated revenues of $115.7 million compared with the $116.2 million reported in the year-ago quarter. The top-line figure, however, surpassed the Zacks Consensus Estimate $112 million. Stream revenues came in at $90.3 million, up from the year-ago quarter’s $83.5 million, driven by increased stream sales from Mount Milligan, Andacollo, Wassa and Rainy River mines. Nonetheless, this upside was partly offset by lower gold and silver sales from the Pueblo Viejo mine. Further, royalty revenues declined to $25.4 million from the prior-year quarter’s $32.7 million, due to a revenue fall in the Peñasquito mine. Nevertheless, reduced royalty revenues were partly muted by an increase in revenues from the Cortez royalty interests.
Operational Highlights
Royal Gold’s volume of 88,400 GEOs (Gold Equivalent Ounces) edged down 0.7% from the year-earlier quarter. Average gold price was up 0.2% to $1,309 per ounce from the year-ago quarter.
The company reported cost of sales of $23.8 million in the reported quarter, up from the year-ago quarter’s $22.2 million. General and administrative expenses slipped to $6.4 million from the prior fiscal year’s $10.9 million. Operating profit came in at $40.7 million, up from the $36.2 million reported in the comparable period last year.
FY19 Performance
Royal Gold’s adjusted earnings per share came in at $1.43 in fiscal 2019, missing the Zacks Consensus Estimate of $1.60. The company had reported a loss of $1.73 per share in fiscal 2018.
Fiscal 2019 revenues came in at $423.1 million compared with the prior fiscal year’s $459 million. Further, the revenue figure missed the Zacks Consensus Estimate of $424.9 million. This downside resulted from a drop in stream revenues, and lower average gold, silver and copper prices.
Financial Position
Net cash provided by operating activities was $253 million in fiscal 2019 compared with $329 million in fiscal 2018. The company ended the fiscal year with $119 million cash in hand, up from $89 million reported at the end of fiscal 2018. As of the end of fiscal 2019, the company’s total debt was around $215 million, down from the $351 million recorded at the end of fiscal 2018. The company paid dividends worth $67.5 million during the fiscal year.
Recent Developments
This July, Cupric, the majority owner of Khoemacau Copper Mining, announced closing the project financing for development of the Khoemacau Copper Silver Project in Botswana. Cupric has added $85 million of equity to the project financing, bringing the total available funding to $650 million.
On Feb 27, Centerra Gold Inc. received an amendment to the Mount Milligan environmental assessment certificate that permits access to additional sources of surface water and groundwater. Mount Milligan commenced accessing water from the newly-permitted sources in the beginning of April 2019. Average mill throughput for the fiscal fourth quarter was 53,559 tons per calendar day, with an average throughput of 60,576 tons per calendar day during June. Despite dry weather conditions, Centerra reaffirmed Mount Milligan’s production guidance for the 2019 calendar year, consisting of payable gold production of 155,000-175,000 ounces and payable copper production of 65-75 million.
How Have Estimates Been Moving Since Then?
Fresh estimates followed an upward path over the past two months. The consensus estimate has shifted 8.33% due to these changes.
VGM Scores
At this time, Royal Gold has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of F on the value side, putting it in the fifth quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Royal Gold has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.