Gold has long been seen as a safe place to put money during uncertain times, but investing in mining companies can come with risks such as rising costs and operational challenges. That is why some investors prefer businesses that benefit from gold production and rising prices without actually operating the mines themselves.
One of the best Canadian stocks that has built its entire business around that idea is Franco-Nevada (TSX: FNV). Through royalties and streaming agreements, it gains exposure to gold and other commodities while avoiding many of the risks traditional miners face. Even after a strong long-term track record, this top gold stock has recently pulled back from its highs, creating a more attractive entry point for investors with a long-term horizon.
In this article, I’ll explain why this TSX stock currently looks attractive to buy now and hold for the long term.
Source: Getty Images
A different way to invest in gold
To put it simply, Franco-Nevada is a gold-focused royalty and streaming firm based in Toronto. Instead of operating mines itself, it provides upfront capital to mining companies in exchange for royalties or streams tied to future production or revenue.
This model gives the company exposure to gold prices and exploration upside while limiting direct exposure to many operating risks that miners face.
FNV stock recently traded at $322.47 per share, giving the company a market cap of about $62.2 billion. Although the stock has risen nearly 14% so far in 2026, it is still down nearly 17% from its 52-week high. At this market price, its dividend yield sits near 0.8%, paid quarterly.
Why its business model matters
This royalty-and-streaming model is powerful because Franco-Nevada does not carry the same mine-level cost inflation risk as a mining operator. Its diversified portfolio includes assets such as Candelaria, Antapaccay, Antamina, Côté Gold, and South Arturo, which support recurring cash flow.
The company’s latest quarterly numbers show how well this model could work when commodity prices are strong. In the first quarter of 2026, Franco-Nevada’s revenue jumped 77% year-over-year (YoY) to a record of US$650.7 million. Its operating cash flow also hit a record US$520.4 million, rising 80% YoY.
Those are not small improvements. They show that Franco-Nevada is benefiting from higher gold and silver prices, along with new asset contributions from places like Côté Gold, Porcupine, and Valentine.
A strong balance sheet and room to grow
Another big reason Foolish investors may like Franco-Nevada is its financial strength. The company remains debt-free and had US$3.4 billion in available capital at the end of March 2026. This matters because royalty companies grow by making new deals.
Franco-Nevada also remains on track with its 2026 guidance of 510,000 to 570,000 gold equivalent ounces sold. That guidance does not include potential extra contributions from Cobre Panamá.
There is also some possible upside from Cobre Panamá. Although the mine remains halted, the government of Panama has approved the processing and export of stockpiled ore. Franco-Nevada expects related stream deliveries to start in the third quarter of 2026, with most deliveries likely coming in 2027.
One short-term risk investors should watch
Of course, Franco-Nevada is not risk-free. The company recently said it is dealing with a dispute related to its Karma Mine stream in Burkina Faso. A local court decision there purported to nullify the stream agreement. Franco-Nevada said the agreement is governed by Ontario law and that it believes the Burkina Faso judgment is not valid. The company is seeking to have the judgment vacated and is pursuing legal remedies.
While this development is worth watching, it doesn’t change the bigger picture as Franco-Nevada’s long-term growth outlook remains strong with a very broad portfolio, a debt-free balance sheet, and strong cash flow.
