Buffett Brain · Research note
Score updated 22 Oct 2026 · analysis from 21 Sept 2026
FNV· Materials
Franco-Nevada
Franco-Nevada's 76% gross margin and zero debt highlight a strong position, but a P/E of 31.4 suggests limited margin of safety.
Buffett fit
Partial fit
Owner
56
Durability
28
Management
90
Price
17
Score updated 22 Oct 2026 · analysis from 21 Sept 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Materials stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
Owning 100% of Franco-Nevada would mean benefiting from a high-margin, low-debt business model with a strong cash position.
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The company's durability is challenged by its reliance on the cyclical nature of the gold market.
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Franco-Nevada has demonstrated prudent with a stable share count and no .
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With an earnings yield of 3.19% and an yield of 3.46%, the current valuation offers little .
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
7- 176.6% , top-quintile in sector.
- 2 of 74.5%, indicating efficient operations.
- 3Net margin of 65.1%, showcasing strong profitability.
- 4Zero debt, providing financial flexibility.
Concerns
7- 1 of 31.4, indicating high market expectations.
- 25-year average of 7.8%, below sector top-quintile.
- 3Profitable 5 years: no, indicating potential volatility in earnings.
- 4High EV/Sales ratio of 20.26, suggesting overvaluation.
Price history
$232+62.4%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Franco-Nevada Corporation operates as a royalty and streaming company focused on gold and other precious metals. It earns revenue by acquiring royalty rights and streaming agreements from mining operators. With a of 76.6% and an of 74.5%, the company benefits from high-margin, asset-light operations. Unit economics are strong due to minimal capital requirements and high cash conversion, as evidenced by an /Net Income ratio of 1.34.
How this analysis has moved
The call has held across 5 reviews.
Sep 27, 2026 → Oct 22, 2026
What other investors would say
The same company, judged by three other documented playbooks.
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