Topic: How To Invest

Q: Hi, Pat. Could you take a look at Sandstorm Gold Royalty Income Stream? Thanks a lot.

Article Excerpt

A: Sandstorm Gold, $8.71, symbol SSL on Toronto (Shares outstanding: 178.8 million; Market cap: $1.5 billion; www.sandstormgold.com), has 188 production streams and royalties on gold mining sites; about 20 of them are related to producing mines. Among those active mines is Yamana Gold’s Cerro Moro in Argentina, First Majestic’s Santa Elena mine in Mexico, McEwen Mining’s Black Fox mine in Ontario, and Bonterra Resources’ Bachelor Lake mine in Quebec. The company acquires its royalties through gold-purchase agreements. Under these deals, Sandstorm makes an upfront cash payment to a gold mine operator. In exchange, it receives the right to purchase a percentage of the gold produced for the life of the mine at a fixed price per ounce. For example, in April 2019, the company entered into a $42.5 million financing package with Americas Silver Corp. That deal includes a $25 million precious-metals stream and a net smelter return (NSR) on the Relief Canyon gold project in Nevada. Sandstorm will also receive a $10 million…