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FREEHOLD ROYALTIES LTD (FRU.CA) Stock Fundamental Analysis

TSX:FRU - Toronto Stock Exchange - CA3565001086 - Common Stock - Currency: CAD

12.63  +0.04 (+0.32%)

Fundamental Rating

6

We assign a fundamental rating of 6 out of 10 to FRU. FRU was compared to 214 industry peers in the Oil, Gas & Consumable Fuels industry. FRU scores excellent points on both the profitability and health parts. This is a solid base for a good stock. FRU is valued correctly, but it does not seem to be growing.


Dividend Valuation Growth Profitability Health

8

1. Profitability

1.1 Basic Checks

FRU had positive earnings in the past year.
In the past year FRU had a positive cash flow from operations.
Of the past 5 years FRU 4 years were profitable.
Each year in the past 5 years FRU had a positive operating cash flow.
FRU.CA Yearly Net Income VS EBIT VS OCF VS FCFFRU.CA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 100M 200M 300M

1.2 Ratios

Looking at the Return On Assets, with a value of 11.23%, FRU belongs to the top of the industry, outperforming 92.54% of the companies in the same industry.
With an excellent Return On Equity value of 14.66%, FRU belongs to the best of the industry, outperforming 82.59% of the companies in the same industry.
FRU has a Return On Invested Capital of 12.56%. This is amongst the best in the industry. FRU outperforms 92.04% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for FRU is above the industry average of 7.73%.
Industry RankSector Rank
ROA 11.23%
ROE 14.66%
ROIC 12.56%
ROA(3y)11.93%
ROA(5y)6.95%
ROE(3y)14.72%
ROE(5y)8.56%
ROIC(3y)12.57%
ROIC(5y)N/A
FRU.CA Yearly ROA, ROE, ROICFRU.CA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 5 10 15 20

1.3 Margins

Looking at the Profit Margin, with a value of 42.42%, FRU belongs to the top of the industry, outperforming 96.02% of the companies in the same industry.
FRU's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 60.02%, FRU belongs to the top of the industry, outperforming 99.00% of the companies in the same industry.
FRU's Operating Margin has improved in the last couple of years.
FRU has a better Gross Margin (96.87%) than 98.51% of its industry peers.
In the last couple of years the Gross Margin of FRU has remained more or less at the same level.
Industry RankSector Rank
OM 60.02%
PM (TTM) 42.42%
GM 96.87%
OM growth 3YN/A
OM growth 5Y30.57%
PM growth 3YN/A
PM growth 5Y34.05%
GM growth 3Y-0.23%
GM growth 5Y0.21%
FRU.CA Yearly Profit, Operating, Gross MarginsFRU.CA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 20 40 60 80

7

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), FRU is creating some value.
The number of shares outstanding for FRU remains at a similar level compared to 1 year ago.
Compared to 5 years ago, FRU has more shares outstanding
Compared to 1 year ago, FRU has an improved debt to assets ratio.
FRU.CA Yearly Shares OutstandingFRU.CA Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 50M 100M 150M
FRU.CA Yearly Total Debt VS Total AssetsFRU.CA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M 1B

2.2 Solvency

An Altman-Z score of 4.57 indicates that FRU is not in any danger for bankruptcy at the moment.
FRU's Altman-Z score of 4.57 is amongst the best of the industry. FRU outperforms 85.57% of its industry peers.
FRU has a debt to FCF ratio of 0.88. This is a very positive value and a sign of high solvency as it would only need 0.88 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.88, FRU belongs to the top of the industry, outperforming 91.54% of the companies in the same industry.
FRU has a Debt/Equity ratio of 0.23. This is a healthy value indicating a solid balance between debt and equity.
FRU has a Debt to Equity ratio of 0.23. This is comparable to the rest of the industry: FRU outperforms 56.22% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.23
Debt/FCF 0.88
Altman-Z 4.57
ROIC/WACC1.64
WACC7.65%
FRU.CA Yearly LT Debt VS Equity VS FCFFRU.CA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M

2.3 Liquidity

FRU has a Current Ratio of 1.65. This is a normal value and indicates that FRU is financially healthy and should not expect problems in meeting its short term obligations.
FRU's Current ratio of 1.65 is fine compared to the rest of the industry. FRU outperforms 74.63% of its industry peers.
FRU has a Quick Ratio of 1.65. This is a normal value and indicates that FRU is financially healthy and should not expect problems in meeting its short term obligations.
FRU has a Quick ratio of 1.65. This is in the better half of the industry: FRU outperforms 76.12% of its industry peers.
Industry RankSector Rank
Current Ratio 1.65
Quick Ratio 1.65
FRU.CA Yearly Current Assets VS Current LiabilitesFRU.CA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 20M 40M 60M 80M

3

3. Growth

3.1 Past

FRU shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -4.36%.
The Earnings Per Share has been growing by 48.69% on average over the past years. This is a very strong growth
FRU shows a decrease in Revenue. In the last year, the revenue decreased by -6.11%.
FRU shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 16.83% yearly.
EPS 1Y (TTM)-4.36%
EPS 3YN/A
EPS 5Y48.69%
EPS Q2Q%-39.29%
Revenue 1Y (TTM)-6.11%
Revenue growth 3Y51.76%
Revenue growth 5Y16.83%
Sales Q2Q%-10.97%

3.2 Future

Based on estimates for the next years, FRU will show a small growth in Earnings Per Share. The EPS will grow by 1.88% on average per year.
FRU is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.56% yearly.
EPS Next Y3.83%
EPS Next 2Y15.3%
EPS Next 3Y1.88%
EPS Next 5YN/A
Revenue Next Year-5.31%
Revenue Next 2Y6.43%
Revenue Next 3Y1.91%
Revenue Next 5Y-0.56%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
FRU.CA Yearly Revenue VS EstimatesFRU.CA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 100M 200M 300M
FRU.CA Yearly EPS VS EstimatesFRU.CA Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 0 0.5 1

5

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 14.35, FRU is valued correctly.
Compared to the rest of the industry, the Price/Earnings ratio of FRU is on the same level as its industry peers.
FRU's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.12.
FRU is valuated reasonably with a Price/Forward Earnings ratio of 10.81.
The rest of the industry has a similar Price/Forward Earnings ratio as FRU.
Compared to an average S&P500 Price/Forward Earnings ratio of 94.77, FRU is valued rather cheaply.
Industry RankSector Rank
PE 14.35
Fwd PE 10.81
FRU.CA Price Earnings VS Forward Price EarningsFRU.CA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

62.19% of the companies in the same industry are more expensive than FRU, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, FRU is valued a bit cheaper than 71.14% of the companies in the same industry.
Industry RankSector Rank
P/FCF 8.82
EV/EBITDA 8.08
FRU.CA Per share dataFRU.CA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 1 2 3 4 5

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of FRU may justify a higher PE ratio.
PEG (NY)3.75
PEG (5Y)0.29
EPS Next 2Y15.3%
EPS Next 3Y1.88%

6

5. Dividend

5.1 Amount

FRU has a Yearly Dividend Yield of 8.58%, which is a nice return.
FRU's Dividend Yield is rather good when compared to the industry average which is at 6.59. FRU pays more dividend than 93.53% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.29, FRU pays a better dividend.
Industry RankSector Rank
Dividend Yield 8.58%

5.2 History

On average, the dividend of FRU grows each year by 11.63%, which is quite nice.
FRU has been paying a dividend for at least 10 years, so it has a reliable track record.
FRU has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)11.63%
Div Incr Years3
Div Non Decr Years3
FRU.CA Yearly Dividends per shareFRU.CA Yearly Dividends per shareYearly Dividends per share 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0.2 0.4 0.6 0.8 1

5.3 Sustainability

FRU pays out 122.69% of its income as dividend. This is not a sustainable payout ratio.
The dividend of FRU is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP122.69%
EPS Next 2Y15.3%
EPS Next 3Y1.88%
FRU.CA Yearly Income VS Free CF VS DividendFRU.CA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 0 100M 200M 300M
FRU.CA Dividend Payout.FRU.CA Dividend Payout, showing the Payout Ratio.FRU.CA Dividend Payout.PayoutRetained Earnings

FREEHOLD ROYALTIES LTD

TSX:FRU (2/7/2025, 7:00:00 PM)

12.63

+0.04 (+0.32%)

Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)11-07 2024-11-07/amc
Earnings (Next)02-26 2025-02-26/amc
Inst Owners30.18%
Inst Owner ChangeN/A
Ins Owners0.43%
Ins Owner ChangeN/A
Market Cap2.07B
Analysts74.44
Price Target17.44 (38.08%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 8.58%
Yearly Dividend1.08
Dividend Growth(5Y)11.63%
DP122.69%
Div Incr Years3
Div Non Decr Years3
Ex-Date01-31 2025-01-31 (0.09)
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-37.02%
Min EPS beat(2)-53.25%
Max EPS beat(2)-20.79%
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)-1.14%
Min Revenue beat(2)-7.88%
Max Revenue beat(2)5.6%
Revenue beat(4)1
Avg Revenue beat(4)-5.72%
Min Revenue beat(4)-11.83%
Max Revenue beat(4)5.6%
Revenue beat(8)1
Avg Revenue beat(8)-6.22%
Revenue beat(12)3
Avg Revenue beat(12)0.57%
Revenue beat(16)6
Avg Revenue beat(16)1.81%
PT rev (1m)-0.38%
PT rev (3m)-1.5%
EPS NQ rev (1m)-20%
EPS NQ rev (3m)55.56%
EPS NY rev (1m)-28.31%
EPS NY rev (3m)-10.56%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)69.06%
Revenue NY rev (3m)-3.63%
Valuation
Industry RankSector Rank
PE 14.35
Fwd PE 10.81
P/S 6.62
P/FCF 8.82
P/OCF 8.82
P/B 2.29
P/tB 2.29
EV/EBITDA 8.08
EPS(TTM)0.88
EY6.97%
EPS(NY)1.17
Fwd EY9.25%
FCF(TTM)1.43
FCFY11.34%
OCF(TTM)1.43
OCFY11.34%
SpS1.91
BVpS5.52
TBVpS5.52
PEG (NY)3.75
PEG (5Y)0.29
Profitability
Industry RankSector Rank
ROA 11.23%
ROE 14.66%
ROCE 16.28%
ROIC 12.56%
ROICexc 12.56%
ROICexgc 12.56%
OM 60.02%
PM (TTM) 42.42%
GM 96.87%
FCFM 75.13%
ROA(3y)11.93%
ROA(5y)6.95%
ROE(3y)14.72%
ROE(5y)8.56%
ROIC(3y)12.57%
ROIC(5y)N/A
ROICexc(3y)12.57%
ROICexc(5y)N/A
ROICexgc(3y)12.57%
ROICexgc(5y)N/A
ROCE(3y)16.29%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5Y45.88%
ROICexc growth 3YN/A
ROICexc growth 5Y45.88%
OM growth 3YN/A
OM growth 5Y30.57%
PM growth 3YN/A
PM growth 5Y34.05%
GM growth 3Y-0.23%
GM growth 5Y0.21%
F-Score4
Asset Turnover0.26
Health
Industry RankSector Rank
Debt/Equity 0.23
Debt/FCF 0.88
Debt/EBITDA 0.74
Cap/Depr N/A
Cap/Sales N/A
Interest Coverage 13.82
Cash Conversion 83.59%
Profit Quality 177.1%
Current Ratio 1.65
Quick Ratio 1.65
Altman-Z 4.57
F-Score4
WACC7.65%
ROIC/WACC1.64
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)181.9%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-4.36%
EPS 3YN/A
EPS 5Y48.69%
EPS Q2Q%-39.29%
EPS Next Y3.83%
EPS Next 2Y15.3%
EPS Next 3Y1.88%
EPS Next 5YN/A
Revenue 1Y (TTM)-6.11%
Revenue growth 3Y51.76%
Revenue growth 5Y16.83%
Sales Q2Q%-10.97%
Revenue Next Year-5.31%
Revenue Next 2Y6.43%
Revenue Next 3Y1.91%
Revenue Next 5Y-0.56%
EBIT growth 1Y-4.34%
EBIT growth 3YN/A
EBIT growth 5Y52.55%
EBIT Next Year115.37%
EBIT Next 3Y30.19%
EBIT Next 5YN/A
FCF growth 1Y-22.82%
FCF growth 3Y49.82%
FCF growth 5Y10.94%
OCF growth 1Y-22.82%
OCF growth 3Y48.83%
OCF growth 5Y10.26%