Just How Bad Was Franco-Nevada's (Latest) Bad News?

This is getting repetitions. But still...

One short year ago, Franco-Nevada (FNV) was the closest thing to a risk-free asset in the gold/silver mining space. As a royalty/streaming company, it boasted the best business model (see The Only Gold Stocks You Really Need). And it was huge, with a history of steady growth and rock-solid finances.

Then came the sudden shutdown of its biggest revenue stream, the Cobre Panama mine. See Just How Bad Was Franco-Nevada's Bad News?

That was a serious hit, but with FNV’s several hundred other revenue sources and the ability to add many more, investors partially forgave its management and chose to buy the dip. The stock recovered some of its Cobre Panama losses and looked primed for more.

Then came this week’s Q2 earnings report, which was disappointing on many levels. The following table shows FNV’s quarterly gold equivalent ounces (GEOs) falling from 132,000 to 82,350 while total revenue dropped from $340 million to $260 million. This was a brutal quarter.

The stock, not surprisingly, took another hit, as many twice-burned investors washed their hands of the now unpredictable situation.

So…time to sell? Or is the story salvageable, maybe even a classic “buy the dip” opportunity? Let’s see: