Wheaton Precious Metals

CN: WPM

C$20338m market cap

C$45.25 last close

Wheaton Precious Metals is the pre-eminent ostensibly precious metals streaming company, with 30 high-quality precious metals streaming and early deposit agreements relating to assets in Mexico, Peru, Canada, Brazil, Chile, Argentina, Sweden, Greece, Portugal and the US.

Investment summary

Wheaton Precious Metals (WPM) generated record operating cash flow, revenue and sales in Q1-Q320, resulting in its quarterly dividend being increased by 20% to 12c per share. While production remained solid in Q4, sales lagged in a coronavirus-disrupted year to result in an increase in ounces produced but not yet delivered to the company. Nevertheless, the finalisation of new streaming agreements with Caldas and Capstone proves that WPM is still able to conclude new business in a coronavirus context.

Y/E Dec
Revenue (US$m)
EBITDA (US$m)
PBT (US$m)
EPS (fd) (c)
P/E (x)
P/CF (x)
2018A 794.0 496.6 203.1 48.0 74.1 30.4
2019A 861.3 548.3 242.7 56.0 63.5 28.9
2020E 1094.4 756.2 498.2 108.0 32.9 19.5
2021E 1493.9 1116.2 810.4 180.0 19.8 14.3
Industry outlook

Under normal circumstances, we believe that WPM could easily justify a valuation of US$53.37, or C$67.44, per share. In the current environment however, we believe that a valuation of US$75.98, or C$96.01, in FY21 is achievable. At the same time, it remains cheaper than the average valuations of its peers in a majority of cases. This follows the settlement reached between WPM and the CRA in December 2018 whereby income from WPM’s international subsidiaries will remain exempt from Canadian tax.

Last updated on 03/03/2021
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Share price graph
Balance sheet
Forecast net debt (US$m) 171.3
Forecast gearing ratio (%) 3
Price performance
%
1m
3m
12m
Actual (13.1) (13.5) 10.9
Relative* (15.0) (17.8) (0.6)
52-week high/low C$75.1/C$33.5
*% relative to local index
Key management
Randy V. J. Smallwood CEO
Gary D. Brown CFO
Emma Murray Director, Investor Relations
Patrick Drouin SVP, Investor Relations

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