Is Royal Gold, Inc. overvalued or undervalued?

As of 20 February 2025, the valuation grade for Royal Gold, Inc. has moved from very attractive to expensive, indicating a shift in market perception. The company is currently considered overvalued. Key ratios include a P/E ratio of 29, an EV to EBITDA of 18.40, and a PEG ratio of 0.37, which suggests that while growth may be priced in, the current valuation does not offer a compelling investment opportunity relative to its earnings.
In comparison to peers, Royal Gold's P/E ratio of 29.64 is higher than the industry average, indicating that investors are paying a premium for its earnings. Additionally, the EV to EBITDA ratio of 18.82 further supports the notion of overvaluation when compared to industry standards. Despite a strong performance against the S&P 500, with a year-to-date return of 38.85% versus the S&P's 2.44%, the elevated valuation metrics suggest that investors may want to exercise caution before entering or increasing positions in Royal Gold, Inc.