Gold Equities: 2Q26 preview

Research evidence excerpt

Gold Equities: 2Q26 preview

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across producers under coverage, while AISC will increase +8%. Lower revenues, higher costs, and a

catch-up in capital spending is forecast to result in a larger decline in financials qoq (earnings -20%,

FCF -34%). Relative to consensus, RBCe forecasts in-line production and AISC (median variance is 0%),

while we forecast weaker financials, including a median -8% EPS, -9% EBITDA, and -16% FCF. In part,

this may reflect stale consensus estimates that do not yet reflect lower realized gold prices. In our

company highlights below, we note an unusually high volume of major corporate and project updates

with 2Q results that could add to surprise risk.

• The near-term outlook is glass half full / empty, depending on your framing. We see a mixed

reporting season ahead. The good: 2Q results represent a seasonally weaker operating period,

although consensus estimates appear reasonable and better results are forecast in 2H; producers

are meaningfully net cash, plus are generating high margins and FCF; management decision-making

remains grounded and companies are continuing to return record volumes of capital; valuations are

still reasonable at spot (Sr. producer P/NAV of 1.12x, 2027 EV/EBITDA of 6.1x and FCF/EV of 7.0%;

royalties P/NAV of 1.65x, EV/EBITDA of 17.4x, and FCF/EV: 4.0%). The bad: Consensus estimates

are elevated and at risk of downward revisions; Margins are compressing on both rising costs and

declining gold prices in 2Q, and potentially go-forward with rising inflationary pressures; momentum

has clearly waned as generalist investors have reduced sector exposure, magnifying the impact of

reactions where execution does not meet expectations; declining gold prices present less-predictable