Durable Goods (Jun F) -9.4% vs 9.3% Prior, Ex-Trans 0.2% vs 0.2%
On Friday, Jefferies analyst initiated an upgrade for Osisko Gold Royalties Ltd (NYSE: NYSE:OR) stock, shifting the rating from Hold to Buy and setting a new price target of $19.00.
The firm anticipates a stable quarter in terms of earnings and cash flow for Osisko, despite lower than expected second-quarter gold equivalent ounce (GEO) sales. The preliminary report indicated that the sales shortfall, which was primarily due to reduced deliveries from Canadian Malartic, Eagle, and Seabee, was compensated for by higher realized prices, leading to a revenue outperformance.
The analyst expects GEO sales to pick up in the latter half of the year, with about 52% of the sales projected to occur in this period. This rebound is predicted to be driven by increased production at Eleonore and Island mines. However, this forecast does not include contributions from the Eagle mine, following the suspension of operations there in late June.
Osisko's earnings and cash flow are projected to grow sequentially over the next three quarters. The analyst's outlook is based on the company's ability to meet its full-year GEO sales and cash margin guidance, despite the challenges faced in the second quarter.
This positive projection has led to the upgrade in Osisko's stock rating and an optimistic price target, suggesting confidence in the company's performance for the remainder of the year.
In other recent news, Osisko Gold Royalties has been in the spotlight due to its Q1 earnings and revenue results. The company reported a solid start to 2024, with Q1 earnings aligning with its annual guidance.
It produced 22,259 gold equivalent ounces (GEOs), aiming to meet its yearly target of 82,000 to 92,000 GEOs. The revenue for the quarter was CAD60.8 million, and the firm concluded the quarter with CAD70.6 million in cash and a net debt of CAD8 million.
BMO Capital maintained its Market Perform rating on Osisko, following the company's recently disclosed second-quarter GEO results, which did not meet the firm's expectations.
Despite this, Osisko has been actively reducing its credit facility balance, indicating a focus on improving its financial position. Investors and stakeholders are now looking forward to Osisko's full financial disclosure in August.
In other company developments, Osisko reported record gold production at the Canadian Malartic mine and plans to add two production assets in the second half of the year.
The company also anticipates closing one or two significant transactions this year. These are recent developments that have shaped the current state of Osisko Gold Royalties.
InvestingPro Insights
Osisko Gold Royalties Ltd (NYSE: OR) has demonstrated resilience in its financial performance, with recent data supporting the positive outlook from analysts. According to InvestingPro data, the company has an impressive gross profit margin, which is a strong indicator of its ability to manage costs and generate profits from its operations. Additionally, Osisko has been successful in raising its dividend for three consecutive years, showcasing its commitment to returning value to shareholders and its confidence in sustained cash flows.
Investors considering Osisko Gold Royalties may find these metrics particularly relevant as they reflect the company's financial health and potential for growth. For those seeking more insights, there are additional InvestingPro Tips available that could provide further depth into Osisko's financial landscape. To explore these tips and gain a comprehensive understanding of the company's prospects, visit https://www.investing.com/pro/OR. Remember to use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription. With more tips available on InvestingPro, investors can make informed decisions backed by real-time data and expert analysis.
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