Freehold Royalties (TSX:FRU) GF Value Rank : 6 (As of May. 09, 2024)

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What is Freehold Royalties GF Value Rank?

Freehold Royalties has the GF Value Rank of 6.

The GF Value Rank is determined by the price-to-GF-Value (P/GF Value) ratio, a proprietary metric calculated based on historical multiples along with an adjustment factor based on a company's past returns and growth and future estimates of the business' performance.

GuruFocus found that for valuation, we cannot simply give stocks a better GF Value rank simply because they have a lower P/GF Value ratio. Backtesting shows that over the long term, the two worst-performing groups are the most expensive group (with the highest P/GF Value ratio) and the least expensive group (with the lowest P/GF Value ratio).

We can understand why the most expensive group underperforms. We were initially puzzled by the underperformance of the least expensive group, but we realized there is a reason why some stocks are super cheap. If they look too undervalued, it is often because the businesses behind them are poor quality. The market realized this and gave them low valuations. In a way, the market is efficient.

After multiple backtesting analyses, we granted the stocks in third-cheapest percentile the highest GF Value rank, as they have performed the best over a full market cycle. Stock performance is actually not as sensitive to valuation as it is to growth and profitability. On average, the companies in the 20%-50% valuation groups have similar performances. Therefore, we should avoid the most expensive and the least expensive stocks. We can be more tolerant of valuation.

Please click GF Score to see more details on the GF Score's 5 Key Aspects of Analysis.

Competitive Comparison of Freehold Royalties's GF Value Rank

For the Oil & Gas E&P subindustry, Freehold Royalties's GF Value Rank, along with its competitors' market caps and GF Value Rank data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Freehold Royalties's GF Value Rank Distribution in the Oil & Gas Industry

For the Oil & Gas industry and Energy sector, Freehold Royalties's GF Value Rank distribution charts can be found below:

* The bar in red indicates where Freehold Royalties's GF Value Rank falls into.

Freehold Royalties GF Value Rank Related Terms

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Freehold Royalties (TSX:FRU) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Energy » Oil & Gas » Freehold Royalties Ltd (TSX:FRU) » Definitions » GF Value Rank

Comparable Companies

Traded in Other Exchanges

FRHLF:USA 1FH:Germany

Address

517 - 10 Avenue SW, Suite 1000, Calgary, AB, CAN, T2R 0A8

Website

https://www.freeholdroyalties.com

Freehold Royalties Ltd is in acquiring and managing Oil and Gas royalties. It operates in two segments: Canada, which includes exploration and evaluation assets and the petroleum and natural gas interests in Western Canada; and the United States, which includes petroleum and natural gas interests held in the Permian (Midland and Delaware), Eagle Ford, Haynesville and Bakken basins primarily located in the states of Texas, Louisiana, and North Dakota. The majority of its revenue is generated from Canada Segment.

Executives

Ian C. Hantke

Senior Officer

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