Jefferies Raise Franco-Nevada (FNV) PT, Keeps Hold Rating

Franco-Nevada Corporation (NYSE:FNV) is one of the 10 Best Gold Stocks To Buy Right Now. On May 28, Jefferies analyst Christopher LaFemina raised the price target on Franco-Nevada Corporation (NYSE:FNV) to $171 from $169 and kept a “Hold” rating.

This adjustment came after a detailed review of Franco-Nevada Corporation’s (NYSE:FNV) recent $1 billion acquisition of the Cote Gold royalty and other factors that could affect the company’s financial model.

An aerial view of a large gold mine showing the extensive activity of natural resource extraction.

The analyst pointed out that investors responded positively to the Cote Gold acquisition because of its large size. Deals of this size are rare in the royalty or streaming business. Additionally, the deal is generating cash flow and there is potential for exploration and throughput increases in the future.

However, the feedback for investors did bring about some concerns about the cost of this deal. LaFemina’s analysis of net present value (NPV) and internal rate of return (IRR) suggests that Franco-Nevada Corporation (NYSE:FNV) may have paid too much for this deal.

Franco-Nevada Corporation (NYSE:FNV) is a leading gold-focused royalty and streaming company that is based in Canada.

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