Royal Gold (RGLD): Assessing Valuation Following Strong Quarterly Growth and Rising Investor Interest

Royal Gold (RGLD) just posted its third quarter results, revealing a clear jump in both sales and net income compared to last year. These strong earnings have caught the attention of investors looking for growth stories in the materials space.

See our latest analysis for Royal Gold.

Royal Gold’s upbeat earnings appear to have fueled real momentum in 2025, reflected by a 40.8% year-to-date share price return. A string of recent developments, including two shelf registration filings, has kept the story interesting for shareholders, and the strong financials have helped deliver a 37% total shareholder return over the past year. With three- and five-year total returns both exceeding 80%, the stock’s track record hints at longer-term growth potential even as the market re-prices the business on fresh results.

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But with shares up over 40% this year and major financial gains in the books, does Royal Gold still have room to rise? Or is the market already factoring in every ounce of future growth?

Most Popular Narrative: 23.6% Undervalued

Compared to its last close price of $189.47, the most widely followed narrative estimates fair value for Royal Gold at $247.91 per share, setting the stage for some intriguing debate about upside potential. Here is a key insight from the narrative underpinning that valuation.

The strategic acquisitions of Sandstorm Gold and Horizon Copper will significantly diversify Royal Gold's asset base, reducing single-asset risk and increasing exposure to long-term growth projects. This should drive more stable and growing revenue streams and improve net margins. Recent investments in projects like the Kansanshi gold stream (with a multi-decade production profile) and the Warintza copper-gold-moly project (large-scale development potential in the early 2030s) position Royal Gold to benefit from increasing demand for gold (as a hedge against inflation and geopolitical risk) and copper (driven by electrification and renewable energy adoption), supporting higher long-term revenue and earnings growth.

Read the complete narrative.

Want to see what’s powering this big valuation call? The narrative reveals bold growth forecasts and a path to expanded margins. Yet its full assumptions might surprise you. Dig in for the drivers behind this price target and discover what could move the stock next.

Result: Fair Value of $247.91 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, Royal Gold remains heavily reliant on gold and faces integration risks with recent acquisitions, so future performance is not guaranteed.

Find out about the key risks to this Royal Gold narrative.

Another View: What Do Earnings Multiples Say?

While some see Royal Gold as undervalued based on discounted cash flow, current earnings ratios tell a different story. The company trades at 33.3 times earnings, sharply above both the industry average of 23.7 and a fair ratio of 26.1. This premium suggests that the market is already factoring in a significant level of optimism, which leaves less margin for error if growth slows. Could expectations be running too far ahead?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Royal Gold Narrative

If you think there’s more to Royal Gold’s story, or want to do your own digging, the data is ready for you to explore and shape your own view in just a few minutes. Do it your way

A great starting point for your Royal Gold research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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