DB:3FO

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Executive Summary

Franco-Nevada Corporation operates as a gold-focused royalty and stream company in the United States, Canada, Latin America, Australia, Europe, and Africa, and internationally.


Snowflake Analysis

Flawless balance sheet with proven track record.


Similar Companies

Share Price & News

How has Franco-Nevada's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 3FO's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-9.1%

3FO

8.2%

DE Metals and Mining

5.0%

DE Market


1 Year Return

69.4%

3FO

-29.0%

DE Metals and Mining

4.1%

DE Market

Return vs Industry: 3FO exceeded the German Metals and Mining industry which returned -31.8% over the past year.

Return vs Market: 3FO exceeded the German Market which returned 0.5% over the past year.


Shareholder returns

3FOIndustryMarket
7 Day-9.1%8.2%5.0%
30 Day-8.9%19.3%13.8%
90 Day12.2%-0.4%3.3%
1 Year71.2%69.4%-28.5%-29.0%5.8%4.1%
3 Year81.9%75.3%-59.0%-60.3%-0.9%-8.5%
5 Year186.1%168.5%-57.3%-59.5%10.5%-3.6%

Price Volatility Vs. Market

How volatile is Franco-Nevada's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Franco-Nevada undervalued compared to its fair value and its price relative to the market?

137.3x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: 3FO (€117.45) is trading above our estimate of fair value (€75.46)

Significantly Below Fair Value: 3FO is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 3FO is poor value based on its PE Ratio (137.3x) compared to the Metals and Mining industry average (8.8x).

PE vs Market: 3FO is poor value based on its PE Ratio (137.3x) compared to the German market (19.5x).


Price to Earnings Growth Ratio

PEG Ratio: 3FO is poor value based on its PEG Ratio (5.1x)


Price to Book Ratio

PB vs Industry: 3FO is overvalued based on its PB Ratio (5.1x) compared to the DE Metals and Mining industry average (4.2x).


Next Steps

Future Growth

How is Franco-Nevada forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

26.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 3FO's forecast earnings growth (26.7% per year) is above the savings rate (0.2%).

Earnings vs Market: 3FO's earnings (26.7% per year) are forecast to grow faster than the German market (21.8% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: 3FO's revenue (4.9% per year) is forecast to grow slower than the German market (5.7% per year).

High Growth Revenue: 3FO's revenue (4.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 3FO's Return on Equity is forecast to be low in 3 years time (8.8%).


Next Steps

  • Explore growth companies in the Materials industry.

Past Performance

How has Franco-Nevada performed over the past 5 years?

26.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 3FO has high quality earnings.

Growing Profit Margin: 3FO's current net profit margins (20%) are lower than last year (21.3%).


Past Earnings Growth Analysis

Earnings Trend: 3FO's earnings have grown significantly by 26.9% per year over the past 5 years.

Accelerating Growth: 3FO's earnings growth over the past year (28.9%) exceeds its 5-year average (26.9% per year).

Earnings vs Industry: 3FO earnings growth over the past year (28.9%) exceeded the Metals and Mining industry -0.06%.


Return on Equity

High ROE: 3FO's Return on Equity (3.7%) is considered low.


Next Steps

Financial Health

How is Franco-Nevada's financial position?


Financial Position Analysis

Short Term Liabilities: 3FO's short term assets ($340.1M) exceed its short term liabilities ($40.6M).

Long Term Liabilities: 3FO's short term assets ($340.1M) exceed its long term liabilities ($64.7M).


Debt to Equity History and Analysis

Debt Level: 3FO is debt free.

Reducing Debt: 3FO had no debt 5 years ago.

Debt Coverage: 3FO has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: 3FO has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is Franco-Nevada's current dividend yield, its reliability and sustainability?

0.79%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: 3FO's dividend (0.79%) isn’t notable compared to the bottom 25% of dividend payers in the German market (1.27%).

High Dividend: 3FO's dividend (0.79%) is low compared to the top 25% of dividend payers in the German market (3.86%).


Stability and Growth of Payments

Stable Dividend: 3FO's dividends per share have been stable in the past 10 years.

Growing Dividend: 3FO's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (104.6%), 3FO's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 3FO's dividends in 3 years are forecast to be well covered by earnings (38.5% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.1yrs

Average board tenure


CEO

Paul Brink

0.083

Tenure

US$3,453,027

Compensation

Mr. Paul Brink serves as Chief Executive Officer and Director of Franco-Nevada Corporation since May 6, 2020 and serves as its President since May 2018. Mr. Brink served as Chief Operating Officer of Franc ...


CEO Compensation Analysis

Compensation vs Market: Paul's total compensation ($USD2.56M) is below average for companies of similar size in the German market ($USD4.95M).

Compensation vs Earnings: Paul's compensation has been consistent with company performance over the past year.


Board Members

NamePositionTenureCompensationOwnership
Paul Brink
President0.083yrUS$3.45m0.11% $25.1m
Pierre Lassonde
Co-Founder & Chair Emeritus0.083yrUS$389.29kno data
Randall Oliphant
Independent Director12.58yrsUS$314.93k0.026% $6.0m
Louis-Pierre Gignac
Independent Director12.58yrsUS$306.58k0.0053% $1.2m
David Peterson
Independent Director12.58yrsUS$324.10k0.0082% $1.9m
David Harquail
Non-Executive Chair0.083yrUS$4.14m0.51% $116.1m
Derek Evans
Lead Independent Director0.083yrUS$311.82k0.0076% $1.7m
Thomas Albanese
Independent Director6.83yrsUS$304.58k0.0059% $1.4m
Catharine E. Farrow
Independent Director5.08yrsUS$295.59k0.00016% $36.7k
Jennifer Maki
Independent Director1.08yrsUS$193.48kno data

3.1yrs

Average Tenure

62yo

Average Age

Experienced Board: 3FO's board of directors are considered experienced (3.1 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: 3FO insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Franco-Nevada Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Franco-Nevada Corporation
  • Ticker: 3FO
  • Exchange: DB
  • Founded: 2007
  • Industry: Gold
  • Sector: Materials
  • Market Cap: CA$34.732b
  • Listing Market Cap: CA$22.920b
  • Shares outstanding: 189.95m
  • Website: https://www.franco-nevada.com

Number of Employees


Location

  • Franco-Nevada Corporation
  • 199 Bay Street
  • Suite 2000
  • Toronto
  • Ontario
  • M5L 1G9
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FNVTSX (The Toronto Stock Exchange)YesCommon SharesCACADDec 2007
3FODB (Deutsche Boerse AG)YesCommon SharesDEEURDec 2007
FNVNYSE (New York Stock Exchange)YesCommon SharesUSUSDDec 2007
0QYZLSE (London Stock Exchange)YesCommon SharesGBCADDec 2007
FNVSWX (SIX Swiss Exchange)YesCommon SharesCHCHFDec 2007
FNV NBMV (Bolsa Mexicana de Valores)YesCommon SharesMXMXNDec 2007

Biography

Franco-Nevada Corporation operates as a gold-focused royalty and stream company in the United States, Canada, Latin America, Australia, Europe, and Africa, and internationally. It operates through two segment, Mining and Energy. The company manages its portfolio with a focus on precious metals, such as gold, silver, and platinum group metals; and energy comprising oil, gas, and natural gas liquids. The company was incorporated in 2007 and is headquartered in Toronto, Canada. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/03 22:27
End of Day Share Price2020/06/03 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.