Update shared on 17 Oct 2025
Fair value Increased 5.80%Analysts have raised their price target for Sandstorm Gold from $17.26 to $18.26. They cite improved revenue growth projections even as the discount rate has increased slightly and there is a modest decline in profit margin expectations.
Analyst Commentary
Following the revised price target for Sandstorm Gold, analyst opinions highlight a range of factors influencing their outlook on the company's prospects. Their views reflect both optimism around future growth and concerns about operational risks and valuation challenges.
Bullish Takeaways
- Bullish analysts expect stronger revenue growth, supported by increased production and potential new royalties. These could enhance cash flow visibility going forward.
- The company's diversified portfolio and strategic investments are seen as factors that support continued expansion and help mitigate some commodity price risks.
- Improved management execution along with a disciplined capital allocation framework are viewed as key contributors to Sandstorm Gold's ability to outperform peers in a competitive sector.
Bearish Takeaways
- Some analysts caution that a modest decline in profit margin expectations may hinder near-term earnings growth relative to previous forecasts.
- A rising discount rate points to a more cautious market environment, which could limit valuation upside and increase the hurdle for future project returns.
- Uncertainty around macroeconomic conditions and commodity price volatility continues to be a concern. This could potentially impact the company's royalty income stability in coming quarters.
What's in the News
- Shareholders have approved a plan of arrangement for Royal Gold Inc. to acquire all outstanding Sandstorm Gold shares. Delisting is expected from the Toronto and New York Stock Exchanges following completion (Key Developments).
- Sandstorm Gold Ltd. has been removed from the PHLX Gold Silver Sector Index (Key Developments).
- The company completed a share buyback tranche between April and June 2025, repurchasing 270,000 shares for CAD 2 million (Key Developments).
- Production guidance for 2025 has been affirmed, with full-year output expected between 65,000 and 80,000 gold equivalent ounces (Key Developments).
- Second quarter 2025 production totaled 15,098 attributable gold equivalent ounces, a decrease from 17,414 ounces in the same period of 2024 (Key Developments).
Valuation Changes
- Consensus Analyst Price Target has increased from CA$17.26 to CA$18.26. This reflects higher expectations for the company’s intrinsic value.
- Discount Rate has risen slightly from 6.74 percent to 6.79 percent. This suggests a marginally higher perceived risk in future cash flows.
- Revenue Growth forecast has improved, moving from 6.57 percent to 7.49 percent. This implies more optimistic sales expectations.
- Net Profit Margin estimate has declined from 43.31 percent to 42.21 percent. This points to expectations for slightly reduced profitability.
- Future P/E ratio has increased from 41.77x to 43.97x. This indicates a higher valuation multiple based on projected earnings.
Disclaimer
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