Gold is having a moment. The precious metal surged to an all-time high of $4,640.13 this week, closing in on the psychologically important $4,700 mark. That's fantastic news if you own gold. But if you own stocks that derive value from gold? Well, things get complicated.
When Success Creates Its Own Problem
Franco-Nevada Corp. (FNV) and Osisko Gold Royalties (OR) are two major royalty and streaming companies that should theoretically benefit from gold's moonshot. And they have. Their stock prices have absolutely ripped higher alongside the metal. The problem? They've risen so sharply that valuation metrics are now flashing bright red warning signals.
According to market data, the "Value" scores for both companies have collapsed into the bottom 10th percentile this week. These scores measure how a stock's market price stacks up against fundamental metrics like assets, earnings, and sales. Translation: the market is paying a hefty premium for these businesses relative to what they actually generate.
The Numbers Behind the Decline
The week-over-week deterioration in valuation is striking. Franco-Nevada's Value score dropped from 11.27 to 9.40, putting it firmly in overvalued territory. Osisko's fall was even steeper, plunging from 10.59 to just 8.81.
What does this mean practically? While both companies remain financially solid, their current share prices appear to be running ahead of underlying business fundamentals like sales and operating performance. Investors are essentially betting on continued momentum rather than present-day value.




