Elemental Altus: A Junior Royalty/Streamer At A Reasonable Price $ELE
https://ceo.ca/@taylordart/ele…mer-at-a-reasonable-price
The immense success of names like Wheaton Precious Metals (WPM.TSX), Franco-Nevada (FNV.TSX), and Royal Gold (RGLD) has made the royalty/streaming sector quite popular among investors, given that it's a superior way to gain precious metals exposure and following the resumption of the bull market for gold in 2016 after what was a violent secular bear market; competition has certainly heated up in this segment of the space. In fact, we've seen multiple new companies move into the spotlight or announce their debuts, including Ely Gold Royalties (previously Ely Gold & Minerals), Elemental Royalties (ELE.V), Maverix Metals (MMX.TSX), Orogen Royalties (OGN.V), Gold Royalty Corporation (GROY), Empress Royalty (EMPR.V), Star Royalties (STRR.V), and others. Not surprisingly, this has led to some much overdue consolidation, with earlier entrants to the space Golden Valley and Abitibi swallowed by new-comer Gold Royalty Corporation, and Ely Gold Royalties acquired as well to create a larger company in a better position to grow its asset base from cash flows vs. debt and share dilution.
The most recent transactions in the space have included Royal Gold's acquisition of Great Bear Royalties (spin-out), Triple Flag and Maverix's merger in Q4 2022, and the attempted but failed takeover of Elemental Royalties, which led to the marriage of Elemental Royalties and Altus Strategies shortly after the Gold Royalty Corporation bid failed. In this update, we'll focus on the new company formed from this transaction, Elemental Altus, which sports a US$196 million fully-diluted market cap but a much larger portfolio with a solid pipeline. In fact, the new company boasts 11 producing royalties (well ahead of the majority of its junior royalty/streaming peers), with a portfolio underpinned by two cornerstone assets, a 0.42% NSR on the Caserones Copper Mine in Chile and a 2.0% NSR on the Karlawinda Gold Project in Western Australia. Let's take a closer look at Elemental Altus Royalties ("Elemental") below: