A month has gone by since the last earnings report for Royal Gold (RGLD). Shares have lost about 5.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Royal Gold due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important drivers.
RGLD Q1 Earnings Beat Estimates on Record Revenue Growth
Royal Gold delivered earnings of $2.72 per share in the first quarter of 2026, marking an increase of 80% year-over-year. Adjusted for discrete tax benefit and other time items, earnings came in at $3.11 per share, beating the Zacks Consensus Estimate of $2.86 by 8.74%.
The company also posted record revenue of $469.1 million, up 142.5% year over year. The quarter reflected strong metal pricing and higher contributions from newer interests, with sales volume rising to 96,300 gold equivalent ounces, up 42.5% from the prior-year period.
RGLD’s Revenue Mix Benefited From Metal Prices and Scale
RGLD’s top-line strength was broad-based across commodities. Gold represented 71% of revenue, while silver and copper contributed 16% and 10%, respectively, with other metals accounting for the balance.
Average realized prices moved sharply higher year over year, led by gold at $4,873 per ounce and silver at $84.33 per ounce, alongside copper at $5.83 per pound. Contributions from Sandstorm and Horizon interests, as well as the Kansanshi stream, also aided the growth.
RGLD’s Cost Profile Shifted With Portfolio Contributions
RGLD’s cost of sales rose to $60.3 million from $24.5 million in the prior-year quarter, reflecting higher payments on stream deliveries tied to stronger metal prices and additional sales volumes from newer streams and acquired interests.
Operating cost lines also expanded. General and administrative expense increased to $17.5 million from $11.1 million, which the company attributed to higher employee-related and corporate costs following the Sandstorm and Horizon acquisition.
Royal Gold’s Cash Flow and Liquidity Strengthened Further
Royal Gold generated record operating cash flow of $293.6 million, up 115.3% from $136.4 million in the year-ago quarter. Free cash flow was $278.9 million compared with $78.1 million a year ago, reflecting the stronger cash generation profile in the period.
Balance sheet flexibility remained a key theme. At March 31, 2026, cash and equivalents were $234.1 million, while debt stood at $600 million on the revolving credit facility after a $300 million repayment during the quarter. Total available liquidity was approximately $1.1 billion, supported by $800 million undrawn on the revolver and $295 million of working capital.
RGLD Reiterated Targets
The company maintained its outlook framework for 2026. Guidance ranges call for gold sales of 290,000–320,000 ounces, silver sales of 3.0–3.5 million ounces, copper sales of 21.0–25.0 million pounds. Through March 31, 2026, performance on these metrics was tracking within the guided ranges, supported by elevated metal prices and expanded portfolio contributions.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -7.14% due to these changes.
VGM Scores
Currently, Royal Gold has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock has a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Royal Gold has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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Royal Gold, Inc. (RGLD): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).