Skip to main content

NEW YORK (TheStreet) -- Sandstorm Gold (SAND) stock coverage was initiated with a "market perform" rating and $4.50 price target at BMO Capital Markets.

The Vancouver-based gold streaming and royalty company provides upfront financing to gold mining companies looking for capital and in return Sandstorm receives a percentage of the gold produced from a mine.

"Over the past 12 months, SAND has improved its overall risk profile through a series of transactions focused on improving asset and counterparty quality. Following this portfolio rebalancing, we forecast over 90% of royalty/stream EBITDA coming from senior and mid-tier operators versus 12% in 2013," BMO wrote in an analyst note.

This diversification strategy looks to have succeeded with the stock outperforming against peers over the last 12 months, according to the firm.

BMO said legacy counterparty risks, lower transaction capacity and potential financing risks may limit upside over the near to medium term.

Shares of Sandstorm are climbing 4.6% to $4.55 in pre-market trading on Thursday as gold prices rally after the Federal Reserve left interest rates unchanged yesterday. 

For August delivery, gold is gaining 1.93% to $1,313.20 per ounce on the COMEX this morning.

Separately, TheStreet Ratings Team has a "Hold" rating with a score of C on the stock.

The primary factors that have impacted the rating are mixed. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income and largely solid financial position with reasonable debt levels by most measures.

But the team also finds that the company's return on equity has been disappointing.

Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author.

You can view the full analysis from the report here: SAND

Image placeholder title