Episode Details

Royal Gold (RGLD) Q2 2026 — Q2 2026 (quarter ended June 30, 2026): revenue $450.5M vs $209.6M, up 114.9%, but 1.8% BELOW the $458.85M Street bar. GAAP EPS $2.78 vs $2.01; adjusted EPS $2.56 vs $1.81, against a $2.55 bar - a one-cent beat. GEOs sold 100,000 vs 63,900 (+56.5%). Record operating cash flow $335.2M. The 8-K was accepted at 5:14 p.m. ET Wednesday Aug 5, so Thursday Aug 6 was the reaction: +1.40% to $218.11 on 801,643 shares against a 709,878 three-month average - LESS volume than the day before the print. Friday Aug 7 rose 5.41% to $229.92 on a ~2% move in spot gold. Royal Gold grew revenue 114.9% and printed record operating cash flow of $335.2 million - and the stock moved 1.4%, on LESS volume than the day before the print. The reason is a second 8-K, filed July 21, that published almost the entire operating quarter fifteen days early: stream sales of $311.0M, 69,000 stream GEOs, cost of sales of $871/GEO, a royalty range of $137-142M and a DD&A range of $95-99M. Royalty revenue landed at $139.6M - the guided midpoint. Our fair value is $212 against the $229.92 close. THE CALL: HOLD (3/5, AN EXCELLENT BUSINESS AT A PRICE THAT ALREADY ASSUMES GOLD RETURNS TO ITS FIRST-QUARTER PEAK AND STAYS THERE) — base-case value ~$212.0 vs ~$229.92 today. KEY METRICS: - CALL: HOLD 3/5, fair value $212 vs the $229.92 Aug 7 close (-8.5%). Bull $259, base $208, bear $192. Street: Buy, 28 analysts, avg target $301.50. - Revenue $450.5M +114.9%; adjusted EPS $2.56 vs a $2.55 bar. But the whole operating quarter was pre-announced July 21, and revenue MISSED by 1.8%. - GEOs per share +21%, not +56.5%: shares +29.1% for Sandstorm. Depletion per GEO $962 vs $488. Realised gold $4,873 Q1, $4,506 Q2, spot ~$4,357. What to watch: UP: gold sustaining above $5,000/oz (our model returns $236 at $5,000 and $259 at $5,500); the 145,000 oz of silver and 1,300 oz of gold left in inventory converting in Q3 (~16c/share); Hod Maden, Warintza and Cascabel starting to contribute ounces; the second $50M Solaris payment perfecting. DOWN: the realised gold price series continuing to fall ($4,873 in Q1, $4,506 in Q2, ~$4,357 spot); depletion per GEO staying near $962; copper/other metals rolling over after running above the top of guidance. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.