Ken
TPZ posted strong Q3 results with total revenue up 5% to 85.8M. This was driven by average royalty production increasing 13% year-over-year and royalty production revenue reaching $67.6M (+3% year-over-year). Cash flow and FCF of $74.7M and $72.4M was down year-over-year by 4% and 6% respectively. Both cash flow and royalty volumes were ahead of consensus estimates for Q3. TPZ paid a $0.31 per share dividend in Q3 and have paid dividends of $0.91 per share year-to-date for a payout ratio of 61%, up significantly from 2022. TPZ also announced a Clearwater acquisition in West Nipisi in Q3. Commodity pricing plays a large role in TPZ’s value, and we think TPZ it is fine for income, but the strong quarter displayed positively for future growth. Consensus calls for very good growth next year, and the balance sheet is in decent shape.