It can feel like the stock market changes every minute. But Franco-Nevada (TSX:FNV) keeps chugging along. This Canadian stock deals with gold and other precious metals. The stock price has been going up nicely, and investors like it because it offers both stability and growth. That’s a pretty good mix to find, so let’s look at whether it’s right for your portfolio.
About the stock
What makes Franco-Nevada different? Well, it doesn’t actually run any mines. Instead, it gives money to mining companies. In return, Franco-Nevada gets a cut of whatever the mines produce in the future. This is called a royalty or a stream. This way of doing business has some perks. Franco-Nevada doesn’t have to worry as much about the day-to-day work of running a mine. It also doesn’t spend as much money upfront. Plus, its investments are spread out across different types of metals and different parts of the world.
In the last three months of 2024, Franco-Nevada made $321 million in revenue. That’s a 5.8% increase compared to the same time the year before. The Canadian stock also made a net income of $245.29 million in that quarter. That’s up from $208.28 million in the previous quarter. The earnings per share (EPS) came in at $0.95, better than what analysts were expecting, which was $0.90.
Franco-Nevada has a lot of different investments, over 400 in total! Its main focus is on gold, silver, and other shiny metals. In 2024, the Canadian stock spent over $1.3 billion on new deals. These included agreements to buy a portion of the future production from gold mines. These new deals could add a significant amount of gold to Franco-Nevada’s yearly earnings, somewhere between 85,000 and 95,000 ounces!
More to come
The Canadian stock’s finances look pretty solid, too. At the end of 2024, Franco-Nevada had $2.4 billion in available cash. This includes a $1 billion credit line, which is like a backup source of money. Having this much cash gives the company flexibility. It can make more investments when good opportunities come along. It also means the Canadian stock is in a good position to handle any bumps in the road in the market.
And here’s something else investors like: the dividend. The regular payment this Canadian stock makes to its shareholders has been strong for almost two decades. In fact, in January 2025, Franco-Nevada announced its 18th year in a row of increasing the annual dividend! Since it first started selling shares to the public, the total amount of dividends paid out has gone over $2.5 billion. That’s a lot of money going back to the investors.
Looking to the future, Franco-Nevada seems optimistic. For 2025, the company expects to sell between 465,000 and 525,000 ounces of gold or the equivalent in other metals. That would be a 7% increase compared to 2024. The Canadian stock also thinks its earnings per share will grow from $3.09 to $4.02, which is a big jump of about 30.1%.
Bottom line
Franco-Nevada has a unique way of doing business. Its diverse investments, strong financial health, and commitment to giving money back to shareholders make it stand out in the Canadian stock market. For investors who want a mix of stable performance and potential for growth, Franco-Nevada looks like a pretty good choice to consider.
