Freehold Royalties Ltd (FRU.TO) Buy, Sell or…

Freehold Royalties Ltd (FRU.TO)

16.82

-0.01 (0.06%)

as of Sep 25, 2026, 8:00:00 pm Market Open.

553 watching

HOLD

He does thinks the dividend is at risk (40-60% cut). FRU-T cut their dividend in 2014 and did raise it back up as conditions improved and he expects FRU-T to do it again now. The best capitalized companies will thrive. He expects them to survive this downturn. He is looking to average down and get his weighting back up.

BUY

Hold or buy a pipeline? He owns this one for his clients. They may decrease drilling, but when other companies reduce drilling they are forced to sell off royalty interests -- this is good for them. They are slow and steady. CN's pension plan owns this as well in a big way. It appears to be on sale to him. He thinks their cash flow will improve when oil returns to above $50 by June.

TOP PICK

An example of understanding the value of the company. They have zero cost of production, so if oil goes to $10, they still make money. Free cashflow machine. Payout ratio is under 100% all the way down to the high 30s. Expects a $10-12 stock with oil above $50 a year from now. Yield is 10.48%. (Analysts’ price target is $10.46)

COMMENT

He bought it too early. The dividend is not sustainable if the price of oil remains at $45 per barrel, but even if they cut it in half, it would still be a good dividend. He owns it because he feels Canadian oil is undervalued and this is due to our politics. The sooner that politicians realize that Canadian runs on oil--and Quebec enjoys massive transfer payments because of oil--then the sooner oil companies will like this will do well.

COMMENT

He doesn't own much oil--too uncertainty. But royalty companies have some advantages and FRU is a good company. If you expect a rebound in energy stocks (he doubts it), FRU isn't a bad way to play. The dividend is relatively secure.

HOLD

A much lower beta play on an oil price recovery. They need $55 oil prices to sustain their cash flows. He likes their low cost assets. Yield 7.5%

TOP PICK

He can't figure out why these types of royalty companies are going out of favour. This type of environment is a good for royalty companies. The dividend is 8.41%. This is an oil and gas name that is safe to own this year. He thinks they will increase the dividend this year. (Analysts’ price target is $10.37)

PAST TOP PICK

(A Top Pick Aug 26/19, Down 0.3%) Has added to his position. A free cashflow machine. Great balance sheet. When the energy sector turns, this stock will take off. Free cashflow yield is 13-14%. A lot of upside. Yield is 9%.

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BUY

It is a great time to be in a royalty company. This is one of the 4 oil and gas holdings he has. This company is pretty sleepy. They recently have been taking on debt, which they don't usually do. They are finding small deals to do because producers are struggling. He likes it and thinks it is well run.

COMMENT

Every time it comes back up it gets beaten down. We are right at the 2009 levels. You have a place to hang your hat here. If it is breaking down here there are bigger problems with this one. You are probably going to get some kind of a dividend cut announcement which the market has already discounted. Expect some volatility.

RISKY

A yield of this level is always a worry, even though management has said it is sustainable. Technically speaking, he looks back to 2009 to see support around current levels. He worries about trying to bottom feed here only to have the distribution cut. A speculative buy here. Yield 9%

TOP PICK

Oil stocks have been slaughtered. This is like owning Saudi oil--FRU's cost of production is $5/barrel. So even if oil plunges to $30, it still makes money. These royalty companies are a great investment. Pays a 9% dividend, paying only 60% of free cash flow. A screaming bargain. (Analysts’ price target is $11.55)

WATCH

Royalty streams. If you believe in western Canada, you just own it, clip the dividend, and own this long-term asset. Owns PrairieSky instead. If you don't drill, it's not good for Freehold.

HOLD

It is one of the higher quality Canadian energy stocks to own. He likes the dividend. There is some hope of Trans-Mountain getting some good news. It does not have much debt. Be patient with it and don't be overweight energy. Don't sell it here.

BUY

Their development costs are low, and they pay a dividend. Rising oil prices is a tailwind. He recently bought it. Likes it.

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Freehold Royalties Ltd (FRU.TO)