By The Gold Report

Source: Streetwise Reports   12/24/2018

A Raymond James report relayed how this royalty and streaming firm intends to use the proceeds.

In a Dec. 19 research note, analyst Brian MacArthur reported that Osisko Gold Royalties Ltd. (OR:TSX; OR:NYSE) received about CA$159.4 million, or US$118.5 million, from Pretium Resources Inc. (PVG:TSX; PVG:NYSE) from its repurchase of Osisko’s interest in the Brucejack mine’s gold-silver stream. Following the sale, Osisko still has exposure to Brucejack via its offtake agreement for 50% gold.

MacArthur noted that Osisko intends to use the monies from Pretium to reduce its debt and buy shares. It will pay the CA$58 million that are outstanding under its revolving credit facility, after which about CA$30 million will remain due.

Also, the company will apply up to CA$100 million toward buying back shares in line with a previous announcement and “under its normal course issuer bid,” the analyst explained.

MacArthur pointed out that such a share repurchase will not impact Osisko’s 2018 production guidance, which remains at 77.5–82.5 thousand ounces of gold equivalent.

Raymond James has an Outperform rating on Osisko, whose share price is ~CA$11.77.

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Disclosures from Raymond James, Osisko Gold Royalties Ltd., December 19, 2018

ANALYST INFORMATION

Analyst Compensation: Equity Research analysts and associates at Raymond James are compensated on a salary and bonus system. Several factors enter into the compensation determination for an analyst, including i) research quality and overall productivity, including success in rating stocks on an absolute basis and relative to the local exchange composite index and/or sector index, ii) recognition from institutional investors, iii) support effectiveness to the institutional and retail sales forces and traders, iv) commissions generated in stocks under coverage that are attributable to the analyst’s efforts, v) net revenues of the overall Equity Capital Markets Group, and vi) compensation levels for analysts at competing investment dealers.
The analyst Brian MacArthur, primarily responsible for the preparation of this research report, attests to the following: (1) that the views and opinions rendered in this research report reflect his or her personal views about the subject companies or issuers and (2) that no part of the research analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views in this research report. In addition, said analyst(s) has not received compensation from any subject company in the last 12 months.

RAYMOND JAMES RELATIONSHIP DISCLOSURES
Certain affiliates of the RJ Group expect to receive or intend to seek compensation for investment banking services from all companies under research coverage within the next three months.

The person(s) responsible for the production of this communication declare(s) that, as far as they are aware, there are no relationships or circumstances (including conflicts of interest) that may in any way impair the objectivity of this recommendation directly or indirectly relates, this has been declared below. This statement applies equally to any persons closely associated with him or her. However, it is possible that persons making communications in relation to a financial instrument may have a holding in that instrument and this will be disclosed. As stated, Raymond James Canada (RJL) has controls in place to manage such risks.

Osisko Gold Royalties Ltd.: Raymond James Ltd. has received compensation for investment banking services within the past 12 months with respect to the issuer.

Osisko Gold Royalties Ltd.: The analyst or associate at Raymond James Ltd. has viewed the material operations of Osisko Gold Royalties Ltd.

( Companies Mentioned: OR:TSX; OR:NYSE,
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