| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 10.00 | -75 |
| Intrinsic value (DCF) | 7.50 | -81 |
| Graham-Dodd Method | 2.20 | -94 |
| Graham Formula | 0.60 | -98 |
Osisko Gold Royalties Ltd (LSE: 0VBE) is a leading precious metals royalty and streaming company headquartered in Montreal, Canada. The company specializes in acquiring and managing royalties, streams, and offtake agreements on mining projects globally, with its flagship asset being a 5% net smelter return royalty on the Canadian Malartic mine, one of Canada's largest gold mines. Osisko focuses primarily on gold, silver, and other precious metals, providing investors with exposure to commodity prices while minimizing operational risks. The company's diversified portfolio includes interests in exploration, evaluation, and development-stage projects, enhancing long-term growth potential. Operating in the Basic Materials sector, Osisko plays a crucial role in financing mining operations while benefiting from production upside without direct mining costs. With a strong balance sheet and strategic investments, Osisko Gold Royalties is positioned as a key player in the royalty and streaming industry.
Osisko Gold Royalties offers investors a lower-risk exposure to gold and precious metals through its royalty and streaming model, which generates stable cash flows without direct operational costs. The company's diversified portfolio, anchored by the Canadian Malartic royalty, provides resilience against project-specific risks. However, its performance remains tied to gold prices, as evidenced by its beta of 0.85. While the dividend yield is attractive, investors should note the company's modest net income margin (~8.5%) and reliance on a few key assets. The strong operating cash flow ($159.9M) supports its capital allocation strategy, but growth depends on acquiring new royalties or streams. Given its moderate debt levels ($98.7M) and solid liquidity ($59.1M cash), Osisko is well-positioned but faces competition from larger peers in the royalty space.
Osisko Gold Royalties competes in the precious metals royalty and streaming sector, where its primary advantage lies in its focused portfolio and strategic royalty acquisitions. The company's 5% NSR on Canadian Malartic provides a stable, long-life cash flow stream from a tier-1 mining asset. Unlike larger competitors, Osisko maintains a more concentrated asset base, allowing for deeper involvement in its key projects. Its competitive positioning is strengthened by its exploration-focused approach, securing royalties on early-stage projects with upside potential. However, Osisko lacks the scale and diversification of industry leaders like Franco-Nevada or Wheaton Precious Metals, making it more susceptible to single-asset risks. The company mitigates this through selective acquisitions and partnerships with mid-tier miners. Its Canadian focus provides jurisdictional safety but limits geographical diversification compared to global peers. Osisko's smaller size allows for agility in deal-making but may restrict access to premier streaming opportunities dominated by larger players. The company's technical expertise in mine evaluation provides an edge in identifying undervalued royalties, though its limited financial resources constrain its ability to compete for large-scale transactions.