Sold my RGLD and half my FNV, added ALS...here is why:Hey everyone.
Wanted to share my thoughts with all of you and would appreciate feedback.
I plan to do a extensive SA article over the weekend on my reasoning.
-> I think RGLD and FNV are somewhat overvalued here, with Oil well below 50$ and most important Copper below 2.6/lb.
Especially RGLDs counterparties are very sensitive to Copper. Their largest revenue contributer is Mt. Milligan, and i highly doubt this mine is profitable at current copper spot. As we also know there is some uncertainly on V.B. which is another cornerstone asset to RGLD. For both FNV and RGLD there are some Qs regarding growth projects. If Copper drops further and some are even calling sub 2$ soon, then i don`t know if Inmet would develop their massive project in Panama for example.
So why i believe more Royalty focused investors might sell RGLD and FNV and buy ALS:
-> ALS Coal Royalties are Tonnage based, and potash prices have stabalized. The overall risk to the counterparties is much lower than thoose of RGLd and FNV, realtive to marketcap.
AS pointed out in my previous SA Article: The coal mines that are under royalty rights to ALS directly feeding some of Albertas largest power plants, thus they will keep mining. At what cost, we don`t really need to care, because its per tonnage royalties.
In addition:
ALS has once again proven they are outstanding ROI creaters.
Bought VGQ at 9 now trading at 15+ in less than 2 yrs thats an impressive ROI
Also Genesee Coal mines will be expanded as planned.
Capital Power and ENMAX Announce All Major Regulatory Approvals Received to Proceed With Genesee 4 & 5 Construction That Will Feature the Most Advanced Technology Available