Join Mark Skousen LIVE at The MoneyShow Orlando!

Join Mark Skousen LIVE at The MoneyShow Orlando!

Franco-Nevada: Skousen's Only Buy in Gold

10/06/2017 6:00 pm EST


Mark Skousen

Editor, Forecasts & Strategies, High-Income Alert

Franco-Nevada Corp. (FNV) is the only stock I recommend for the long term in the precious metals field. Unlike most mining companies, it has a good upward trend, notes Mark Skousen, editor of Forecasts & Strategies

Get Trading Insights, MoneyShow’s free trading newsletter »

For the past 10 years, Barrick Gold has lost money but Franco-Nevada has been a five-bagger. That’s because Franco-Nevada has a very different business model than the mining companies. 

It doesn’t mine gold, but rather finances the miners' massive up-front costs in return for either royalties or the right to purchase a percentage of precious metals from a mine at discounted prices (known as streaming). As a result, Franco-Nevada gets metals at low costs while bypassing mining costs and risks.


With profit margins exceeding 21%, Franco-Nevada has continued to grow rapidly. It had a record year in 2016 with revenues and earnings up more than 8%. 

The company has no debt, and $614 million in cash. It needs to earn more to raise its dividend beyond the current 23 cents per share.

It is expected to do so with its new streaming agreements in oil & gas. So far, this new investment area has contributed to only 5% of earnings, but that’s expected to double in the next year.

Gold has retreated to $1,270 an ounce in the past week, sending FNV lower. But long term, Franco-Nevada—with a 1.2% yield—is bound to rise. Keep buying.

Subscribe to Mark Skousen's Forecasts & Strategies here…

  By clicking submit, you agree to our privacy policy & terms of service.

Related Articles on COMMODITIES

Keyword Image
Top Picks 2019: B2GOLD (BTG)
01/17/2019 5:00 am EST

Gold bottomed in December 2015 and momentum has been shifting to the upside since then, with gold&rs...

Keyword Image
Top Picks 2019: Mene (MENE)
01/15/2019 5:00 am EST

You might not yet have heard the name Mene (Vancouver: MENE), but you could soon enough, especially ...