FNV Franco Nevada Precious Metal Royalty Company – Leading Stock Trading At All Time Highs

by Olivier on August 14, 2014

Almost  2 years ago FNV – Franco Nevada was trading near its all time high and I wrote the following post: FNV – Franco Nevada Leading Precious Metal Stock. Today we have almost the exact same situation. FNV is the strongest big cap precious metal stock out there and it is again trading close to its all time high. Today FNV announced a 500 Million bought deal financing at 59.75 US$. The way I see it, this was probably the last opportunity for institutional investors to buy into FNV without moving the stock’s price through open market buying. Again, my opinions do not matter. What matters though is FNV’s chart. FNV is now all cashed up. It is trading within inches of its all time high. The bought deal was done at a decent price. This means the highest odds proposition is for FNV to be the leading big cap precious metals stock during the next gold rally. I believe the bought deal pricing at 59.75 US$ should provide a decent floor. Price should not dip significantly below that level. As long as the stock acts well these levels should be used to initiate a position in FNV. If FNV subsequently manages to take out its all time high that would be an area where additional buys would make sense. I already own positions in FNV and RGLD and plan to buy more if FNV prints new all time highs.

Remember: ‘A leader needs to lead.’ I only expect a decent gold rally if FNV can indeed assume a leadership role. Given the recent bought deal I assume the stock will digest the news for a few days and then FNV should be the go to stock for institutional precious metal investors.

Click on the FNV Franco Nevada chart to enlarge:

Keep in mind FNV is a royalty company. For all those who are not familiar with the advantages of royalty companies, a few years ago I wrote an article highlighting the main companies: Precious Metal Royalty Companies Overview. Not much has changed. Both FNV – Franco Nevada and RGLD – Royal Gold look very good and will most likely be leaders in the coming precious metal bull market cycle.

To anticipate the market is to gamble. To be patient and react only when the market gives the signal is to speculate. – Jesse Livermore

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