BMO lifts Vox Royalty stock target to $4 on Kanmantoo acquisition

Published 16/05/2025, 16:06
BMO lifts Vox Royalty stock target to $4 on Kanmantoo acquisition

On Friday, BMO Capital Markets updated its stance on Vox Royalty Corp. (NASDAQ:VOXR), raising the price target to $4.00, up from the previous $3.50, while maintaining an Outperform rating on the stock. The company’s stock, currently trading at $3.33, has demonstrated impressive momentum with a 62.63% return over the past year. According to InvestingPro analysis, the stock appears to be trading above its Fair Value, with 8 additional key insights available to subscribers.

Vox Royalty reported its first-quarter earnings for 2025, with results mostly aligning with BMO Capital’s projections. The adjusted earnings per share (EPS) were slightly lower than expected, primarily due to higher taxes, but the quarterly revenue matched forecasts. The company’s cash flow did not meet the analyst’s expectations. With an impressive gross profit margin of 98.52% and a healthy current ratio of 4.19, InvestingPro data reveals strong underlying fundamentals. Investors should note the next earnings release is scheduled for May 27, 2025.

The increase in the price target comes after Vox Royalty’s acquisition of the Kanmantoo Net Smelter Return (NSR) royalty, which prompted the company to revise its revenue guidance upward for the year 2025. BMO Capital views the acquisition positively, citing several benefits.

According to the analyst, the Kanmantoo royalty deal was secured at an attractive internal rate of return (IRR). The transaction is expected to provide immediate cash flow to Vox Royalty and is backed by public disclosures from the operator. Additionally, the Kanmantoo project is situated in a jurisdiction considered to be of high quality and offers potential for further exploration.

Rene Cartier of BMO Capital highlighted the strategic value of the acquisition in his commentary, stating, "In our view, the transaction was completed at an attractive IRR, provides immediate cash flow, benefits from public operator disclosures, is located in a quality jurisdiction, and has upside exploration optionality." The new price target reflects the anticipated benefits from the recent acquisition.

In other recent news, Vox Royalty Corp. has reported significant updates from its mining partners in Western Australia, which could impact its future revenue. Black Cat Syndicate Limited announced the first gold pour at its Lakewood mill and received approval for underground mining at the Myhree deposit, expected to start after open-pit completion in late 2025. Vox Royalty holds a 1% net smelter return on the Myhree and other deposits within the Kal East project. Additionally, Norwest Minerals Limited was granted a mining lease for the Bulgera Gold Project, marking a significant step towards its development. Vox has a 1% NSR over Bulgera, which is seen as having potential for a brownfields operational restart within one to three years. Evolution Mining Limited began operations at the Castle Hill deposit and commissioned its Mungari mill expansion ahead of schedule, which could accelerate revenue from Vox’s A$40/oz Au royalty over Castle Hill. Vox Royalty’s strategy focuses on high-return royalty acquisitions, supported by a portfolio of over 60 royalties across six jurisdictions. These developments are expected to contribute to Vox’s royalty revenue in the near and medium term.

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