With gold prices at US$4400/oz giving producers all-in sustaining costs of over $2000/oz, more than the gold price was a year ago, will result in more aggressive shareholder returns policies and the prospect of 10% yields, David Garofalo, chief executive of Gold Royalty told Mining Journal.

The gold price bonanza has already enabled many companies to clean up their balance sheets, and invest more in sustaining capital and exploration. Shareholder returns have also increased with more money returned through the first nine months of 2025 than in all of 2024. In the September quarter several gold companies enjoyed AISC margins of 60-70%. Royalty and streaming companies are even higher, with Gold Royalty’s at more than 90%

With the December 2025 quarter results due to be published in February, expected to reflect the gains of a strong move higher in that quarter, shareholder returns could become a new front as companies seek to attract generalist investors.

“I spoke with a retired mining executive from the base metal universe recently and he’s decided to deploy a significant amount of his net worth into the gold equities because he thinks that a lot of them are going to start to yield close to 10%, given the free cashflow profile that’s going to be delivered given how rapidly the gold price has gone up,” said Garofalo.

Consolidation

The royalty and streaming space saw further consolidation in 2025 in addition to a significant new investor in the form of stablecoin company Tether, which bought stakes in Elemental Royalty, Metalla Royalty and Streaming and Gold Royalty. New royalty companies were also created. such as LunR Royalties, which was created by NGEx Resources to hold a royalty on the Lunahuasi copper exploration project in San Juan, Argentina.

Garafolo believes further consolidation in the royalty and streaming sector is coming as participants seek scale in order to obtain a lower cost of capital, which is the main competitive factor in acquiring new royalties and streams.

Garafolo sees opportunity in becoming a mid-tier royalty company. If the three companies Tether has invested in were to merge, it would create a $3.5 billion company holding a clear sixth place in the industry. Garafolo gave no indication that this possibility is on the cards.

“Tether recognises that achieving scale is important to the business model. I think their intentions are to facilitate consolidation in the space. It will be interesting to see how the sequencing will happen. What is missing in the royalty and streaming space is a mid-cap champion. That space is largely vacated, something in that Goldilocks zone of $5-10 billion market cap that is big enough to be relevant to large-scale institutions on the buy side, but still small enough to grow. I would argue if you can get a growth vehicle on that scale, you’re likely to get a multiple superior to the seniors who are great companies, but really don’t have a path to growth because they become too large,” said Garofalo.

Shares in Gold Royalty have increased in value by 266% over the past year. They are trading at $4.43, valuing the company at $990 million.