Royal Gold (RGLD) announces highest dividend increase since 2013 – November 17, 2021


Royal Gold, Inc.‘s (RGLD Free Report) approved a 17% increase – the largest percentage increase since 2013 – to an annual dividend of $ 1.40 per share. This is the 21st consecutive annual dividend increase for the company. The new quarterly dividend of 35 cents per share will be payable on January 21, 2022, to shareholders of record on January 7, 2022.

This will bring Royal Gold’s dividend yield from the current 1.12% to 1.31%, above the 1.2% average of the S&P 500 composite. The move highlights the company’s record earnings from its strong portfolio in the first quarter of fiscal 2022 (ended September 30, 2021) combined with expectations of revenue growth from its new production assets as well as a strong balance sheet.

Revenue was $ 174 million, reflecting 19% year-over-year growth. Increased gold sales at Mount Milligan, increased gold production at Cortez, gold sales from the newly acquired NX Gold Stream and an increase in average copper prices contributed to the performance of the former trimester. Adjusted earnings per share were $ 1.07 in the quarter, up 30.5% year-over-year, driven by record revenues and strong operating performance.

Royal Gold’s free cash flow from operating activities was $ 129.9 million in the first fiscal quarter, compared to $ 94 million in the prior year quarter. The increase was primarily the result of an increase in cash revenue received from the Company’s flow and royalty interest, net of cost of sales, and production taxes of $ 33.1 million. As of September 30, 2021, the company had $ 1.1 billion in total cash.

Royal Gold last increased its quarterly dividend from 7% (or 8 cents per share) to 30 cents in November 2020. Over the past 10 years, Royal Gold has increased its quarterly payout by 11 cents per share to the announced dividend. current 35 cents. , reflecting a 10-year CAGR of 12%. Since it began paying dividends in 2000, RGLD has paid approximately $ 680 million in dividends to its shareholders. Royal Gold currently has a payout ratio of 38.24%, above the industry’s 33.42% and the S&P 500’s 30.33%. The company has a five-year dividend growth rate of 5.6 %.

The company outperforms its peers Franco-Nevada Society (FNV Free Report), which has a dividend yield of 0.81%, a five-year dividend growth rate of 5.5%, and a payout of 31.82%. The gold-focused royalty and flow company increased its quarterly dividend in March by 15% to 30 cents, marking its 14th annual dividend increase.

Franco-Nevada is financially strong and has a debt free balance sheet. FNV generated $ 676 million in operating cash flow in the first nine months of 2021, up from $ 558 million in the prior year period. As of September 30, 2021, the company had available capital of $ 1.4 billion.

In August, the gold digger Barrick Gold Company (GOLD Free Report) announced a dividend increase of 12.5% ​​to 9 cents per share. GOLD plans to return $ 750 million to shareholders in 2021. This is in addition to the payment of a third repayment installment of $ 250 million (or 14 cents per share).

Barrick Gold expects to return $ 750 million to shareholders in 2021. GOLD has a strong liquidity position and generates healthy cash flow, which positions the company well to take advantage of attractive development, exploration and acquisition. Barrick Gold has reached its zero net debt goal by the end of 2020.

In August, Wheaton Precious Metals (WPM Free Report) announced a quarterly dividend of 15 cents per share, a 50% increase from last year and representing the fourth consecutive quarterly dividend increase. WPM, which is one of the largest precious metals streaming companies in the world that generates revenue primarily from the sale of gold, silver and palladium, provides investors with leverage to increase the prices of precious metals, sustainable dividend payment and organic growth and acquisition opportunities.

Wheaton’s strong cash position, operating cash flow and available credit capacity provide investment opportunities to acquire additional accretive precious metals. It had around $ 372 million in cash at the end of the third quarter of 2021, with no outstanding debt.

Price return

Image source: Zacks Investment Research

So far this year, shares of Royal Gold have gained 0.8% against an industry decline of 5.3%.

Zack Rank

Royal Gold currently wears a Zacks Rank # 3 (Hold). You can see The full list of Zacks # 1 Rank (Strong Buy) stocks today here.

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