Royal Gold, Inc.RGLD provided an update on its second-quarter fiscal 2017 (ended Dec 31, 2016). During the quarter, Royal Gold's fully-owned subsidiary, RGLD Gold AG sold around 53,000 ounces of gold and 543,000 ounces of silver under its streaming agreements. The company ended the quarter with 24,000 ounces of gold and 323,000 ounces of silver in its inventory.
Average realized gold and silver prices were a respective $1,226 and $17.51 per ounce sold, lower than the quarter ago figures of $1,329 and $19.52.
In the quarter, cost of sales was roughly $373 per gold equivalent ounce. The cost of sales was based on the quarterly average silver-gold ratio of roughly 71 to 1, up from $352 per gold equivalent ounce in the prior quarter. Royal Gold will release its second-quarter results before the market opens on Feb 2, 2017.
During the quarter, Royal Gold paid $75 million as the last advance payment for the acquisition of Rainy River gold and silver stream. On Jan 3, 2017, the company also made its final payment of $10 million, as advance payment of its Wassa and Prestea gold stream acquisition.
Royal Gold's shares gained 1.2% in the last three months while the Zacks categorized Mining-Gold industry has gained about 0.3% over the same period.
Royal Gold reported increased revenues and earnings, year over year, in the first quarter of fiscal 2017. However, as per the update for the second quarter, costs are expected to be higher while the realized prices lower, quarter over quarter. Moreover, the company is exposed to volatility in the price of gold that could have a significant impact on earnings.
Royal Gold, Inc. Price
Zacks Rank & Key Pick
Royal Gold currently carries a Zacks Rank #4 (Sell).
Vale reported a positive earnings surprise of 35.71% in the last reported quarter and sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .
Teck Resources, also carrying a Zacks Rank #1, has an expected long term growth rate of 10.65%.
Pretium Resources, carrying a Zacks Rank #2 (Buy), has an average positive earnings surprise of 14.58% over the trailing four quarters.
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