Lundin says hold Sandstorm Gold

2014-06-12 17:39 ET - In the News

Brien Lundin, in the June, 2014, edition of the Gold Newsletter, says hold Sandstorm Gold Ltd., recently $5.22. Mr. Lundin said buy twice -- in September, 2011, at $1.44 (the stock rolled back one for five in May, 2012), and in September, 2012, at $9.75. Assuming a $1,000 investment for each of the two buys, the $2,000 position is now worth $1,258. Sandstorm has released its financial results for the first quarter of 2014 and they look solid to Mr. Lundin. The company earned $3.8-million on revenue of $15.3-million. It closed the quarter with an operating cash flow of $9.2-million and a healthy cash balance of $110-million. In February, Sandstorm agreed to help SilverCrest Mines Inc. by financing 20 per cent of the capital expenditures required for underground development at SilverCrest's Santa Elena mine in Mexico. In exchange, it has the right to purchase 20 per cent of underground gold production at $350 an ounce for the first 50,000 ounces and $450 an ounce thereafter. Mr. Lundin says deals like that one explain why Sandstorm has been able to stay profitable in a difficult market; its gold stream model provides both protection when prices fall and leverage when they rise. Sandstorm remains a hold.