We are a little disappointed with Santoys decision to sell three of its Labrador properties to Mega Uranium, we would have preferred Santoy to have kept possession of these properties and pushed on with the development.

Yes they did get 400,000 shares in Mega Uranium in return so we should be pleased as we are fans of Mega and hold their stock. However we can own Mega Uranium directly should we wish so owning them indirectly is not what we would have preferred. This move reduces Santoys exposure as a uranium play by taking this element of the mix. True they still have a number of good opportunities in the Athabasca basin, British Columbia, Quebec and Central America. They also have interests in coal and oil and gas too. It may still be a good uranium play but we think that our cash would be better employed in a uranium stock that has a closer to a 100% exposure to uranium than Santoy has at the moment. A company such as Khan Resource springs to mind but as we already have some of their stock we think it prudent to look further a field.

As we can see from the chart this stock was trading as low as $0.30 around October last year so it put in a terrific run since then to be trading at $1.39 today. We paid $0.81 for it on 27 December 2006 so we are looking at a profit of 70% in a little under 4 months, which we will now take and put the cash to one side.

Santoy resources goes back on to the watch list and we will watch it with great interest going forward as a cheaper entry point may present itself that makes the stock attractive again to us. If your gut feel is to stick with it then do just that.

Santoy trades on the Toronto Venture Exchange under the symbol SAN.