Shares of Nova Royalty Corp. (TSXV:NOVR) have soared more than 160% since Capital Ideas first wrote about the company about two months ago
Capital Ideas Media | December 30, 2020 | SmallCapPower: As one of the most-recent entrants into the publicly-traded resource royalty space, Nova Royalty Corp. (TSXV:NOVR) is focusing exclusively on acquiring royalties on the next generation of copper and nickel mines.
(Originally published on Capital Ideas Media on October 27, 2020)
Copper and nickel are key raw materials used in the drive towards cleaner energy, especially in electric vehicles and batteries used for power storage. According to the European Institute, each tonne of copper contributes to an annual reduction of up to 7,500 tonnes of CO2.
[Editor’s Note: Shares of Nova Royalty have soared more than 160% since Capital Ideas wrote about the company about two months ago.]
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The resource royalty business has proven to be lucrative, especially for companies such as Franco-Nevada Corporation, which has generated compounded average annual investor returns of more than 21% during the past 13 years.
These royalty companies lend money to resource developers in return for a percentage of future production. They can also purchase existing royalties, in which they consider undervalued. It has proven to be an attractive financing option for resource juniors that want to avoid excessive shareholder dilution.
Nova Royalty currently owns 15 royalties, 13 of which are in Canada. Some of the key ones include a 2.0% Net Smelter Royalty (NSR) on the Dumont nickel project in Quebec, the world’s second largest undeveloped nickel deposit, and a 2.0% NSR on Teck/Newmont joint venture NuevaUnión in Chile, one of the world’s largest undeveloped copper projects.
Nova Royalty’s non-executive Chairman is Brett Heath, founder and CEO of Metalla Royalty & Streaming Ltd. (TSXV:MTA). Shares of MTA have surged more than 410% in less than three years since going public.
Nova Royalty Corp. shares have climbed 204% since it began trading on the Toronto Venture exchange on October 1, 2020.
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