Royal Bank of Canada (RY) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

-7.7%

$189.74

vs $205.52 price

Levered DCF

$1,030.33

After debt service

Piotroski score

6 / 9

Average

Altman Z-score

0.28

Distress zone

Rating

C+

Overall 2 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	14.53×	14.95×	10.73×	11.37×	11.67×	11.89×	12.09×	11.42×
P/B	2.08×	1.87×	1.34×	1.64×	1.87×	1.53×	1.82×	1.73×
P/S	2.1×	1.77×	1.36×	2.65×	3.19×	2.17×	2.26×	2.4×
EV / EBITDA	36.07×	39.16×	37.82×	30.56×	24.02×	30.3×	32.83×	30.47×
Gross margin	45.3%	40.3%	43.3%	72.3%	87.2%	69.9%	65.2%	71.6%
Operating margin	18.7%	14.8%	16.0%	30.1%	35.8%	23.5%	23.6%	27.4%
Net margin	14.8%	12.1%	12.9%	23.6%	27.8%	18.7%	19.1%	21.5%
Current ratio	0.13×	0.14×	0.18×	0.21×	0.21×	0.19×	0.12×	0.13×
Debt / equity	6×	6.13×	6.73×	6.47×	5.75×	6.25×	5.97×	5.75×
Interest coverage	0.36×	0.26×	0.29×	1.11×	2.53×	1.02×	0.74×	1.05×
Dividend yield	3.0%	2.8%	3.6%	3.9%	3.5%	4.8%	4.0%	4.1%
Payout ratio	43.2%	40.9%	38.0%	44.1%	40.0%	55.4%	46.9%	45.5%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	14.6%	12.8%	12.7%	14.6%	16.3%	13.2%	15.4%	15.5%
Return on invested capital	1.6%	1.4%	1.3%	1.5%	1.9%	1.4%	1.7%	1.8%
Return on assets	0.9%	0.7%	0.7%	0.8%	0.9%	0.7%	0.9%	0.9%
Free cash flow yield	18.4%	8.8%	15.1%	11.0%	32.0%	102.6%	7.9%	11.2%
Earnings yield	7.1%	6.8%	9.5%	8.9%	8.7%	8.6%	8.4%	9.0%
Enterprise value	$1T	$894.6B	$795.7B	$695.5B	$557.9B	$516.3B	$585.9B	$530.5B
Net debt / EBITDA	26.02×	28.75×	30.49×	22.79×	16.09×	22.52×	24.29×	22.52×
Cash conversion cycle (days)	-2	-15	-21	-197	-376	-77	-23	-86