In short: Asked about the copper-focused royalty companies: "I'm bullish on the whole copper industry… the funding need will be so great that the Ecoras and the Altiuses and the Elementals — even the third tier royalty companies — will have the ability to participate in syndicated interests." The valuation argument attached: "at least the nominal price that the market pays for copper five years from now will be dramatically higher than it is today… to the extent that you can buy a royalty that pencils even in mid single digits at today's copper price, if you've bought the right copper asset with long production life, you'll be surprised at what the net present value of that deposit is 5 years from now."
Ecora is a smaller royalty company focused on the metals used in electrification — copper above all. Asked directly about copper-focused royalty names, Rick says "I'm bullish on the whole copper industry," and expects the funding need to be so large that even the smaller royalty houses get invited into syndicated deals they could never lead.
He also gives the valuation test to apply. Buy a royalty on a good, long-life copper asset that produces only a mid-single-digit return at today's copper price, and you will "be surprised at what the net present value of that deposit is 5 years from now" — because he expects the copper price then to be dramatically higher. The royalty's cash flows rise with the metal price while its cost base doesn't rise at all, so a mediocre-looking yield today becomes a good one later. The risk, of course, is the opposite: if copper doesn't move, a mid-single-digit yield is what you own.
40:08— Well, I'm bullish on the whole copper industry. I think one of the things that's going to happen in the context of this funding need that I see is that the funding need will be so great that the Ecoras and the Altiuses and the Elementals, even the third tier royalty companies will have the ability to participate in syndicated interests.
In short: The name the question was about, and he has owned it "including predecessor companies that became Ecora — Anglo Pacific — for 20 years." The thesis is a completed pivot plus a maturing clock: they took the cash from two Queensland coal royalties the market hated and "used that money to diversify into other kinds of royalty, in particular copper." Crucially "not all of the royalties that they bought were producing royalties, but rather royalties that would come into play in the 5-to-7-year time frame. Importantly, they made those investments 4 years ago. So, 5 to 7 years is imminent now." Hence "there is zero doubt in my mind that the cash flow, which is already ample, is going to become spectacular" — even "assuming the copper price went nowhere, you take the number of producing royalties from three to nine." Time-frame warning attached: "don't buy a stock with a 5-year time frame if you have trauma holding stock over a long weekend." (He twice says "Altius" mid-answer while describing this portfolio — see the anomaly note below.)
A royalty company owns a slice of a mine's revenue without operating it — no payroll, no diesel bill, no cost overruns. Ecora (formerly Anglo Pacific) built itself on two coal royalties in Queensland, Australia. Those royalties made a lot of money but had two problems: the coal would eventually run out, and investors refused to pay a fair multiple for coal income at all.
Management spent that unloved cash flow buying royalties on other metals, mostly copper — and, importantly, bought them cheap by buying royalties on mines that had not been built yet. A royalty that pays nothing for five to seven years is worth far less today than one paying now, so you get it at a discount and simply wait. Rick's point is that the waiting is nearly over: "they made those investments 4 years ago. So, 5 to 7 years is imminent now."
The arithmetic he cares about needs no view on the copper price at all: the number of royalties actually paying cash goes "from three to nine." That is why he says "there is zero doubt in my mind that the cash flow, which is already ample, is going to become spectacular." The catch is time — this is a three-to-five-year holding, and he says so bluntly: "don't buy a stock with a 5-year time frame if you have trauma holding stock over a long weekend."
14:36I do have some skin in the game with them and I think the world of them but more importantly I think the world of their assets and how they're run. Give me your opinion on Acora Acora royalties. — Well, Acora has done a great job. I — Haven't they? — I've owned it. Including predecessor companies that became Acora. Anglo Pacific for 20 years.
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Verbatim excerpts from the public transcripts (auto-pulled at each mention's timestamp, lightly cleaned). Timestamps link into the video; "source page" opens that commentator's full analysis at this row. Click a mention's header line to expand it (one open at a time). For personal study — not investment advice.