Franco-Nevada (FNV) Q2 Earnings Top Estimates, Revenues Dip Y/Y
Franco-Nevada Corporation FNV reported adjusted earnings of 95 cents per share in second-quarter 2023, beating the Zacks Consensus Estimate of 83 cents per share. The bottom line decreased 7% year over year.
The company generated revenues of $330 million in the reported quarter, down 6.4% year over year. The downside was driven by lower commodity prices for its diversified assets that offset higher revenues from Precious Metal assets. In the June-end quarter, 78.6% of revenues were sourced from Precious Metal assets (64.8% gold, 10.7% silver and 3.1% platinum group metals).
The company sold 132,033 Gold Equivalent Ounces (GEOs) from precious metal assets in the reported quarter, up from the prior-year quarter’s 131,574 GEOs. The upside was driven by operations at Cobre Panama and Antapaccay successfully returning to full production.
In the reported quarter, adjusted EBITDA was down 8.5% year over year to $276 million. Adjusted EBITDA margin was 83.5% in the quarter under review.
Franco-Nevada Corporation Price, Consensus and EPS Surprise
Franco-Nevada Corporation price-consensus-eps-surprise-chart | Franco-Nevada Corporation Quote
Financial Position
The company had $1,295 million cash in hand at the end of the second quarter of 2023, up from the $1,197 million reported as of the end of 2022. It recorded an operating cash flow of $472 million in the first half of 2023, down from $488 million in the prior-year period.
Franco-Nevada is debt-free and uses its free cash flow to expand its portfolio and pay out dividends. FNV now has an available capital of $2.3 billion.
Price Performance
Franco-Nevada’s shares have gained 4.7% in the past year compared with the industry’s growth of 12.2%.
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Zacks Rank & Stocks to Consider
FNV currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the basic materials space are Carpenter Technology Corporation CRS, PPG Industries, Inc. PPG and Bunge Limited BG. CRS and PPG sport a Zacks Rank #1 (Strong Buy) at present, and BG has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Carpenter Technology has an average trailing four-quarter earnings surprise of 10%. The Zacks Consensus Estimate for CRS’s fiscal 2024 earnings is pegged at $3.23 per share. The consensus estimate for 2023 earnings has moved 12% north in the past 60 days. Its shares gained 71% in the last year.
The Zacks Consensus Estimate for PPG Industries’ fiscal 2023 earnings per share is pegged at $7.47, indicating growth of 23.5% from the prior-year actual. Earnings estimates have moved 3% north in the past 60 days. It has an average trailing four-quarter earnings surprise of 7.3%. PPG’s shares have gained 9.5% in the past year.
Bunge has an average trailing four-quarter earnings surprise of 20.4%. The Zacks Consensus Estimate for BG’s 2023 earnings is pegged at $12.13 per share. The consensus estimate for 2023 earnings has moved 4% north over the past 60 days. BG’s shares gained 17.1% in the last year.
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