Little-Known Companies With Lots of 'Precious Assets'
Speaking of gold, the other little known company that's making a big name for itself is Sandstorm Gold (SAND), which is the most recent success story among the few precious metals royalty-streaming companies. In fact its CEO comes from the wildly successful Silver Wheaton (SLW), which is my single favorite way to play the prospect of silver rising to new all-time highs in the months and years ahead.
Jim Cramer recently interviewed the CEO of Sandstorm and it tells the colorful facts on why this company is another "goose that lays the golden egg."
SAND hit a 52-week high on Oct. 8 of $15.43 and on Oct. 9 sold off 6.64% on over 2.4 million shares traded to close at $14.07. This may be the beginning of the much anticipated correction of this amazing stock.
Look at this one-year price chart including the stock's 200-day moving average, which illustrates how far this stock has skyrocketed. It really needs to come back down to earth and I hope to begin accumulating shares when it gets closer to $11, if indeed it corrects that much.After Sandstorm reported its stellar 134% year-over-year quarterly earnings growth (as of June 30) only a few analysts and investment educators like Jim Cramer realized how an outstanding business model like SAND creates such remarkable results. The Vancouver-based company focuses on completing gold purchase agreements with gold mining companies that have advanced stage development projects or operating mines. The company also engages in mine financing business, as well as provides an alternative to gold mining companies in search of capital. It offers cash payment to gold mining companies and in exchange receives the right to purchase a percentage of the gold produced for the life of the mine at a fixed price per ounce. It is one of only three publicly-traded companies that capitalizes on this highly lucrative opportunity, and the best years for these three -- Franco Nevada (FNV) and Royal Gold (RGLD) being the other two -- are directly ahead. As the central banks of the world do all they can do revive the shaky global economy through massive monetary easing and dilution of their paper currencies, gold and silver are likely to go to yet-to-be realized levels. So will the cost of feeding the world. Those are just some of the reasons why I'm bullish on companies like Sprott Resources and Sandstorm Gold. Accumulate them while they're correcting and after you've had a chance to convince yourself that these two companies would be precious assets in your portfolio. As of the time of publication the author has a position in SCPZF. This article was written by an independent contributor, separate from TheStreet's regular news coverage. Jim Cramer and Stephanie Link actively manage a real money portfolio for his charitable trust- enjoy advance notice of every trade, full access to the portfolio, and deep coverage of the latest economic events and market movements.
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