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TICKERS: FISH; OTC

Royalty Corp. Gains Coverage and a Buy Rating
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Sailfish Royalty Corp. (FISH:TSX.V; OTC:SROYF) recently gained coverage from Atrium Research.

-Atrium Research analysts Ben Pirie and Nicholas Cortellucci, in a research report published on October 1, 2024, initiated coverage on Sailfish Royalty Corp. (FISH:TSX.V; OTC:SROYF) with a Buy rating and a price target of CA$2.00. The report highlights Sailfish's focus on precious metals royalties and streaming in the Americas, with a particular emphasis on shareholder returns.

The analysts emphasized Sailfish's commitment to shareholder value, stating, "FISH is focusing on returning capital to shareholders via share buybacks and dividends while keeping G&A to a minimum. Sailfish has repurchased over 12M shares since June 2019, representing 16% of its shares outstanding, and currently offers a 5.0% dividend yield, the highest yield amongst all mining royalty firms."

Pirie and Cortellucci highlighted the company's key assets, particularly the Spring Valley Gold Project in Nevada, noting, "FISH has various royalties on the Spring Valley Gold Project in Pershing County, Nevada. This is an advanced development project with a >$1B NPV and is owned by Waterton Global Resource Management. The mine is expected to begin production in 2028 and scale to 349Koz [gold] Au per year."

The analysts also pointed out the steady cash flow from Nicaraguan assets, stating, "San Albino is a high-grade gold mine in Nicaragua owned by Mako Mining (MKO:TSXV) that started commercial production in July 2021. Sailfish has a gold stream equivalent to a 3% NSR on the mine."

Regarding Sailfish's strategic positioning, the analysts noted, "Given that access to capital is highly important for royalty companies, FISH has a major competitive advantage of having Wexford Capital as its majority shareholder (61.5%). Management owns 4.3% and is highly experienced in the mining royalties and capital markets."

Atrium Research's valuation methodology for Sailfish is based on a Net Asset Value (NAV) approach. The analysts explained, "We utilize an NAV valuation to derive our target price on Sailfish, using only the Nicaragua, Spring Valley, and Gavilanes assets. We project out the production and NSR for the Nicaragua assets and Spring Valley and assume an EV/oz valuation for Gavilanes."

They added, "We use a 5% discount rate to obtain a valuation on the Spring Valley royalty at US$118.9M or US$1.67/share as well as a valuation on the Nicaragua assets at US$13.2M or US$0.19/share. Our model assumes US$1/oz of silver for the Gavilanes property, equating to US$22.0M or US$0.31/share."

The analysts concluded, "We apply a 0.7x multiple onto this (small/mid-cap group average) and convert to CAD to obtain our CA$2.00/share target price."

Pirie and Cortellucci identified several catalysts for Sailfish, including:
1. EIS Submission (Q4-Q1) & Record of Decision for Spring Valley (Q2/25)
2. Potential as a takeover candidate

In conclusion, Atrium Research's initiation of coverage with a Buy rating and CA$2.00 price target reflects a positive outlook on Sailfish Royalty Corp.'s portfolio of royalties and its focus on shareholder returns.

The analysts' target price, considering the company's share price at the time of the report of CA$1.36, represents a potentially significant return to the analysts' target price, considering the 5.0% dividend yield and 52.0% total return mentioned.


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Important Disclosures:

  1. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

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Disclosures for Atrium Research, Sailfish Royalty Corp., October 1, 2024

Analyst Certification Each authoring analyst of Atrium Research on this report certifies that (i) the recommendations and opinions expressed in this research accurately reflect the authoring analyst’s personal, independent and objective views about any and all of the designated securities discussed (ii) no part of the authoring analyst’s compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in the research, (iii) to the best of the authoring analyst’s knowledge, she/he is not in receipt of material non-public information about the issuer, (iv) the analyst does not own common shares, options, or warrants in the company under coverage, and (v) the analysts adhere to the CFA Institute guidelines for analyst independence.

About Atrium Research Atrium Research provides institutional quality issuer paid research on public equities in North America. Our investment philosophy takes a 3-5 year view on equities currently being overlooked by the market. Our research process emphasizes understanding the key performance metrics for each specific company, trustworthy management teams, unit economics, and an in-depth valuation analysis. For further information on our team, please visit https://www.atriumresearch.ca/team.

General Information Atrium Research Corporation (ARC) has created and distributed this report. This report is based on information we considered reliable; we have not been provided with any material non-public information by the company (or companies) discussed in this report. We do not represent that this report is accurate or complete and it should not be relied upon as such; further any information in this report is subject to change without any formal or type of notice provided. Investors should consider this report as only one factor in their investment decisions; this report is not intended as a replacement for investor’s independent judgment. ARC is not an IIROC registered dealer and does not offer investment-banking services to its clients. ARC (and its employees) do not own, trade or have a beneficial interest in the securities of the companies we provide research services for and does not serve as an officer or Director of the companies discussed in this report. ARC does not make a market in any securities. This report is not disseminated in connection with any distribution of securities and is not an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal. ARC does not make any warranties, expressed or implied, as to the results to be obtained from using this information and makes no express of implied warranties for particular use. Anyone using this report assumes full responsibility for whatever results they obtain. This does not constitute a personal recommendation or take into account any financial or investment objectives, financial situations or needs of individuals. This report has not been prepared for any particular individual or institution. Recipients should consider whether any information in this report is suitable for their particular circumstances and should seek professional advice. Past performance is not a guide for future results, future returns are not guaranteed, and loss of original capital may occur. Neither ARC nor any person employed by ARC accepts any liability whatsoever for any direct or indirect loss resulting from any use of its research or the information it contains. This report contains "forward looking" statements. Forward-looking statements regarding the Company and/or stock’s performance inherently involve risks and uncertainties that could cause actual results to differ from such forward-looking statements. Such statements involve a number of risks and uncertainties such as competition, technology shifts, market demand and the company’s (and management’s) ability to correctly forecast financial estimates; please see the company’s MD&A “Risk Factors” Section for a more complete discussion of company specific risks for the company discussed in this report. ARC is receiving a cash compensation from Sailfish Royalty Corp. for 12-months of research coverage. ARC retains full editorial control over its research content. ARC does not have investment banking relationships and does not expect to receive any investment banking driven income. ARC reports are primarily disseminated electronically and, in some cases, printed form. Electronic reports are simultaneously available to all recipients in any form. Reprints of ARC reports are prohibited without permission. To receive future reports on covered companies please visit https://www.atriumresearch.ca/research or subscribe on our website. The information contained in this report is intended to be viewed only in jurisdictions where it may be legally viewed and is not intended for use by any person or entity in any jurisdiction where such use would be contrary to local regulations or which would require any registration requirement within such jurisdiction.





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