Freehold Royalties Ltd (FRU.TO)

We've passed peak demand for traditional carbon-based energy. The future is renewables. So, commodities are cyclical, with peaks and valleys. The chart since 2022 reflects this. Is not a long-term hold, but FRU is a trade. He wouldn't add money to energy now, which has had its run. 

He consider the dividend during technical analysis. $15 was the breakout and now support. The trend is in your favour.

34% heavy, 50% oil, 8% NGL, 44% gas. All the growth is in the US. He sold out. Question is:  what's the right multiple? He hates dividend yield as a valuation metric.

If you can make 5 years of dividends in 2 months, it might not be the worst decision you can make to sell. You've done well, life is good.

If you own strictly for the dividend (tax implications aside), perhaps it's prudent to take a bit of $$ off the table. If you're owning for growth upside, he'd also take $$ off the table because there's meaningfully higher upside in other names.

Remains a top pick for him. Largest weight in his income fund. Sleepy, boring, but a good yield.

Chose it for the nice, sustainable dividend. Didn't expect it to perform so well when crude's down 13% this year (but seeds are there for pricing to firm up). Again, we've seen money flows into Canada and into energy. Starting to get a nice re-rate, yet dividend still hefty.

Might be the top-performing royalty company in Canada this year, up ~20%. Will never shoot the lights out, very much just collect your 7.2-7.3% dividend yield -- sustainable down to $50-51 oil. Enough inventory to pay that dividend for the next 30-35 years. Excellent choice for a very safe and steady yield.

He's bullish on oil for the second half of next year and on nat gas. Benefits from that rise in prices, but no capex risk. Still compelling, despite the runup, especially in a world of interest rate reductions. Wouldn't trim. Largest holding in his energy income fund.

One of the largest weights in his income fund. Today yields 7.3%. XOM is its largest client in the Permian. Roughly 35 years of drilling inventory between Canada and the US. Canadian production stagnating, increased growth in US. As both oil and nat gas prices increase over time, should see small dividend bump up along the way.

Nice upward trajectory since April selloff. Defensive royalty model is always a safer bet in the space. Q3 and Q4 results showed steady production. Strategic US acquisitions. Buy to Neutral from analysts. Not too much upside from here. Can hold for yield.

Limited growth relative to other producers, high payout ratio. Best suited for defensive investors, don't expect fireworks. Declining oil prices could trim payouts. Dividend has been cut in past. Earnings forecast to potentially fall by 2.3% over next year. Raised dividend, yield is ~7.7%.

An Alberta company, with many royalties down south in the Permian Basin. Production in the Permian should continue to trend higher over the next year. Even if capex is heavy for those producers, a royalty company doesn't care because it just skims $$ off the top.

Instead he'd own WCP, which pays a similar dividend. But both are good.

Likes it for the dividend yield. Don't expect more than that unless the commodity price moves. Has actually performed quite defensively through the oil price selloff. More defensive than your average oil stock.

To accumulate, he'd be looking in the $12 range. Your buying opportunity would be 10-15-20% downside from where it is today.

Sector's come under a bit of pressure, but the theme of commodities is quite interesting. Down move today doesn't worry him too much. Investors are reacting (erroneously) to the price of oil moving around. This name could get down to the $13 range, but the trend is decent. Pretty good upside. Dividend is decent, too.

See his Top Picks.

Likes the dividend of just below 8%. With that kind of yield, can't expect stock price to do that much. Up 6% this year, not as much as the market. Considering price of oil and that yield, she's OK with it. Breakeven oil price is ~$50, and they're transparent about this. Has cut dividend in past, but first to raise again when oil price recovers.

Likes management. Royalty, so not spending $$ on drilling and exploration. Will probably see more acquisitions in US.

Owns the land that others drill and pay FRU a portion of what they extract. Loves it. One of the best management teams in the royalty space. Very good balance sheet. Very good geographic locations, both in Canada and (more recently) in US. Very conservative capital allocators. Very good dividend yield ~8%.

If you believe (as he does) that oil and gas prices will go up over next little while, then this name should perform from a bump up in drilling activity.

More defensive than other names in the space, as you're not taking on the capital-investment risk to develop resources.

Freehold Royalties reported strong second quarter (Q2) 2025 earnings, highlighted by solid production growth but with a year-over-year decline in profitability on lower commodity prices. Revenue was $78 million, reflecting continued operational momentum and a 9% year-over-year increase in total production. Total production grew by 9% compared to Q2 2024, indicating strengthened asset performance and successful leasing activity. Net income for the quarter was $6.24 million, which is a significant decrease versus $39.3 million in Q2 2024. Still, we like the production growth and valuation, and would see it as a BUY for the sector. 
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