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Option1307 (29.65)

I'm Buying Sandtorm Energy and Metals (STTYF)

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9

April 17, 2013 – Comments (8) | RELATED TICKERS: STTYF.DL

I've been saying for the past few months that the market needed to take a break from the relentless upward trend. In my opinion it just simply wasn't sustainable. I'm not saying we need a crash, but a healthy correction is always a good thing for the markets.

Hopefully, and this is a big hopefully, we are now seeing the market correction that I have been accumulating cash waiting for. I'm not confident this will amount to much, but I'm itching to pull the trigger if a correction does come to fruition.

With all that being said, I do think now is a good time to start accumulating shares of Sandstorm metals and energy. This stock has been beat down and presents a great buy at these levels. I strongly believe STTYF will become cash flow positive this year, likely Q3 or Q4 at the latest. Even if we do get the correction and Sandstorm falls further I still believe this is a great entry point to start building a position.

Deej as well as others have discussed STTYF extensively on Caps recently, I recommend reading TMFDeej blogs for an extensive look.  

Happy buying Fools. Stay safe out there in this volatile market! 

8 Comments – Post Your Own

#1) On April 17, 2013 at 1:25 PM, Option1307 (29.65) wrote:

See TMFDeej blogs below for details:

 http://caps.fool.com/Blogs/the-answer-to-the-question/810263

 http://caps.fool.com/Blogs/sandstorm-metals-and-energy-a/809667

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#2) On April 17, 2013 at 1:27 PM, Option1307 (29.65) wrote:

Happy days!

My limit order triggered today at 0.28. Don't go all in here, but start building a position.

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#3) On April 17, 2013 at 4:00 PM, L0RDZ (82.16) wrote:

Jason to me  it  would seem  risky  to  buy  even  at these levels,   and than  in my opinion  only  the  strong  players  will  survive.

At  what  prices  are  sand  getting  and  what  about  if   the  companies  they  give money  to  ???  don't  produce  or  go under ?

 

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#4) On April 17, 2013 at 4:51 PM, ThisIsFor2053 (42.47) wrote:

Over the past year STTYF has written off some deals that didn't pan out.  They've also been riding the coattails of SAND, which has taken a beating lately as well.

It's fortunate that one of their streams is natural gas, but their other streams are copper with Donner Metals and Palladium with Colossus Minerals - a stock that hasn't looked healthy at all recently.

They won't see significant cash flow for a few more quarters, so I think there is plenty of time to acquire shares at lower prices over the next 6 months. 

Keep in mind that they will be going through a very aggressive reverse split soon at 10:1.  I will be watching the action after that split and will be beginning my acquisition phase then.

GLTA 

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#5) On April 17, 2013 at 4:59 PM, Option1307 (29.65) wrote:

Lordz

At  what  prices  are  sand  getting  ...

You can read their latest quarterly report and see for yourself what price they are contracted to pay for the commodities stream. But they are all very good deals for Sandstorm, way below the individual commodity market level.

and  what  about  if   the  companies  they  give money  to  ???  don't  produce  or  go under ? 

This is a fair question especially since this scenario has basically plagued the company for its first several years of existence. I do believe that they have finally figured things out and turned the company around. It took managment a bit to realize that while similar models, you can't directly apply the same principles as they did to SLW and  SAND to sandstorm metals and energy. The underlying commodities are different and that makes for slightly different ways to go after these commodity streams.

However, I have said numerous times and continue to state that betting on STTYF is essentially betting on Nolan Watson. Do you believe he can turn this commodity stream model into another successful company? 

I do, but that is something everyone needs to decide for themselves. The risk/reward at these levels is killer, I really think people should establish a starter position.

 

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#6) On April 17, 2013 at 5:05 PM, Option1307 (29.65) wrote:

They won't see significant cash flow for a few more quarters, so I think there is plenty of time to acquire shares at lower prices over the next 6 months.

Partially agree here. I think that entirely depends on what the overall market and commodities in particular do going forward. If we rally from this point we may not see prices these low again. If commodities continue to get killed, then yes, STTYF will likely head south. That is why I'm suggesting starting a position here. Unless you can see into the future we don't know which direction the market is headed.

Keep in mind that they will be going through a very aggressive reverse split soon at 10:1.  I will be watching the action after that split and will be beginning my acquisition phase then.

Fair enough, it will be interesting to see how things pan out.

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#7) On April 17, 2013 at 6:56 PM, awallejr (85.54) wrote:

Well I bought STYYF when I bought SS just for the heck of it.  While I sold out of SS, I still have STYYF.  But right now I am eyeing SLW more especially in light of their major gold stream with Vale.  They are further along on the income producing and paying dividends now.  Tempted to start now but I just see it going under $20.  Might sell some puts in case it doesn't.

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#8) On April 19, 2013 at 7:04 PM, wossamattau (< 20) wrote:

I am in for the long haul with this company. But, what about the 1 for 10 reverse split just voted on by shareholders? I have been considering pulling the trigger on another purchase before the consolidation, but would be sick to see it sink lower after it is complete.

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