Freehold Royalties Ltd. Fundamental Analysis (TSX: FRU.TO)
Freehold Royalties Ltd. Fundamental Analysis (TSX: FRU.TO)
Freehold Royalties Ltd. (TSX: FRU.TO) shows moderate financial fundamentals with a PE ratio of 20.74, profit margin of 43.54%, and ROE of 13.88%. The company generates $0.3B in annual revenue with weak year-over-year growth of 1.29%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 58.1/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze FRU.TO's fundamental strength across five key dimensions:
Efficiency Score
WeakFRU.TO struggles to generate sufficient returns from assets.
Valuation Score
ExcellentFRU.TO trades at attractive valuation levels.
Growth Score
WeakFRU.TO faces weak or negative growth trends.
Financial Health Score
ExcellentFRU.TO maintains a strong and stable balance sheet.
Profitability Score
ModerateFRU.TO maintains healthy but balanced margins.
Key Financial Metrics
Is FRU.TO Expensive or Cheap?
P/E Ratio
FRU.TO trades at 20.74 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, FRU.TO's PEG of 1.77 indicates fair valuation.
Price to Book
The market values Freehold Royalties Ltd. at 2.87 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 8.73 times EBITDA. This is generally considered low.
How Well Does FRU.TO Make Money?
Net Profit Margin
For every $100 in sales, Freehold Royalties Ltd. keeps $43.54 as profit after all expenses.
Operating Margin
Core operations generate 55.01 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $13.88 in profit for every $100 of shareholder equity.
ROA
Freehold Royalties Ltd. generates $10.00 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Freehold Royalties Ltd. generates strong operating cash flow of $232.84M, reflecting robust business health.
Free Cash Flow
Freehold Royalties Ltd. generates strong free cash flow of $188.94M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $1.15 in free cash annually.
FCF Yield
FRU.TO converts 6.50% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
20.74
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
1.77
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.87
vs 25 benchmark
P/S Ratio
Price to sales ratio
9.03
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.28
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.80
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.14
vs 25 benchmark
ROA
Return on assets percentage
0.10
vs 25 benchmark
ROCE
Return on capital employed
0.13
vs 25 benchmark
How FRU.TO Stacks Against Its Sector Peers
| Metric | FRU.TO Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 20.74 | 21.23 | Neutral |
| ROE | 13.88% | 1266.00% | Weak |
| Net Margin | 43.54% | 1278.00% | Weak |
| Debt/Equity | 0.28 | -1.82 (disorted) | Distorted |
| Current Ratio | 1.80 | 2.24 | Neutral |
| ROA | 10.00% | 4418.00% | Weak |
FRU.TO outperforms its industry in 0 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Freehold Royalties Ltd.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
152.23%
Industry Style: Cyclical, Value, Commodity
High GrowthEPS CAGR
576.90%
Industry Style: Cyclical, Value, Commodity
High GrowthFCF CAGR
159.07%
Industry Style: Cyclical, Value, Commodity
High Growth