Production to exceed 1m GEOs by FY30

With the acquisition of the BHP Antamina stream, we are forecasting that WPM’s attributable production will grow decisively above one million gold equivalent ounces (GEOs) by FY30 (cf 691.7k GEOs in FY25).

Valuation: Still trending up

Using a capital asset pricing model-type method, whereby we discount cash flows at a nominal 9% per year, we calculate a terminal valuation for WPM of US$90.15/share (or C$122.49/share) in FY30 (cf US$77.99 previously), assuming zero long-term growth in real cash flows thereafter (which we think unlikely). If we instead assume 8.2% per year long-term growth in cash flows (ie the average CAGR in the price of gold from 1967 to 2025), our terminal value rises to US$616.53/share ( C$837.69/share) and our current valuation to US$410.14/share ( C$557.25/share). As such, at an implied growth rate of 6.8% per year, WPM’s share price currently appears to be discounting future compound annual average increases in cash flows per share from FY30 well below historical levels (+14.3% CAGR since FY05), especially given that production is expected to deliver 12.8% per year organic growth between now and FY30 alone. An alternative interpretation is that the market is assuming that current precious metals prices will prevail into FY30 with compound annual average increases in WPM’s cash flows per share thereafter of just 3.4% per year (ie below the long-term rate of historical US inflation). Otherwise, assuming no purchases of additional streams, we calculate a value per share of US$109.68 (or C$150.53, or £81.64) in FY27, based on a historical multiple of 31.2x contemporary earnings (albeit at a gold price of only US$2,239/oz and a silver price of only US$60.00/oz). At current prices, this value rises by 114.5% to US$235.26/share ( C$322.87/share, or £175.12). In the meantime, WPM maintains a premium rating within the sector. However, this would reverse into quite a material discount if metals prices remain at current levels into FY27.

Q425 production and sales results

WPM’s Q425/FY25 are being released on Thursday 12 March, after the bell in Toronto. From the fact that it produced 416,286oz gold, 22.434Moz silver, 10,265oz palladium and 2,460klb cobalt in FY25 (see 16 February announcement) and sold 411,005oz Au, 19.796Moz Ag, 9,356oz Pd and 1,632klb Co, we may deduce that it produced 131,547oz Au, 6.295Moz Ag, 2,519oz Pd and 669klbs Co and that it sold 121,791oz Au, 5.685Moz Ag, 1,730oz Pd and 485klb Co in Q425. In general, therefore, production was greater than our prior expectations (as well as being ahead of guidance for the year) for all four metals, while sales were ahead for gold and silver, but slightly behind for palladium and cobalt. Given this and higher metals prices during the period, we have updated our earnings forecasts for Wheaton, as shown in Exhibit 1, below:

Exhibit 2 compares our updated EPS forecasts with those of the market, demonstrating that they lie at the top of the range of expectations:

At the time of writing, production and by-product production numbers were known for at least Penasquito, Zinkgruvan, Neves-Corvo (now renamed Somincor by its operator, Boliden), Constancia, Antamina, Blackwater, San Dimas, Sudbury, Salobo and Voisey’s Bay, with the standout feature of the quarter being the 62,900t copper produced at Salobo (cf 53,000t in Q3 and our prior expectation of c 50,000t based on Vale’s essentially flat guidance for copper output in FY25 relative to FY24).

The relationship between copper output at Salobo and gold production attributable to Wheaton is extremely close (see Exhibit 3) and this result allows us to predict 88,670oz (±3,499oz) Au production at Salobo attributable to Wheaton in Q4 (as shown in Exhibit 4), which, if realised, would be a new record for this asset and materially above the 71,500oz that we were forecasting previously.

Relative to our prior expectations notably good performances were also recorded by Neves-Corvo, Constancia, Antamina, San Dimas and Stillwater (palladium). WPM’s production and sales figures also imply a solid maiden contribution from Hemlo.

Ounces produced but not yet delivered

For the quarter, gold sales were 9,756oz, or 7.4%, below production, which was very close to the long-term average quarterly rate of under-sales of 7.0% (±17.3% standard deviation) since Q112. Silver sales were 610koz, or 9.7%, below production and were lower than the long-term average quarterly under-sales rate of 12.8% (±10.8% standard deviation) since Q112. Both suggest that there was no appreciable ‘flow through’ effect in Q4; however, neither was there any appreciable ramp-up in ounces produced but not yet delivered (PBND).

As a result, we estimate that gold ounces PBND may have increased to c 116,157oz, or 3.4 months of estimated FY25 production, which compares with WPM’s target levels of two to three months of PBND for gold and palladium production. We estimate that silver ounces PBND may have increased to c 3.9Moz, or 2.1 months of estimated FY25 production, which compares with WPM’s target level of two months for silver production.

General and administrative expenses

At the time of its Q424 results, WPM provided guidance for non-stock G&A expenses of US$50–55m, or US$12.50–13.75m per quarter, for FY25. Stock-based G&A expenses broadly correlate with movements in WPM’s share price (in US dollars) between quarters and, given the movement in WPM’s shares over Q425, we would estimate these to be in the order of US$7.1m, as shown by the oval in Exhibit 7, below:

While this outcome would run somewhat against historical precedent in that the charge in the final quarter of the year tends to be higher than in preceding quarters, it nevertheless results in a total for the year of US$92.5m, of which the stock-based component would be US$37.9m (41.0%), which is slightly above the long-term average of 35.6%, but attests to WPM’s strong share price performance during FY25.

Antamina stream acquisition

On 16 February, Wheaton also announced that it had entered into a definitive precious metals purchase agreement (PMPA) with BHP for its 33.75% portion of the silver produced at Antamina. Wheaton already has a PMPA with Glencore for its 33.75% portion on the silver produced at Antamina and so the BHP Antamina stream acquisition effectively doubles its exposure to the mine (to 67.5% of all the silver produced from Antamina) for an upfront payment of US$4.3bn.

The salient features of the transaction are essentially the same as for WPM’s Glencore stream from Antamina, with the exception of the consideration ( US$4.3bn cf US$900m, albeit in a much higher silver price environment) and the first drop-down level (100Moz Ag delivered cf 140Moz delivered). Its salient features are summarised below:

• The stream is effective from 1 April, from which time WPM will purchase BHP's 33.75% of the payable silver from Antamina until a total of 100Moz has been delivered, at which point Wheaton will purchase 22.5% of the payable silver for the remainder of the life of mine. Payable silver will be calculated using a fixed payable factor of 90.0%.
• The acquisition is expected to add c 6.0Moz Ag per year for the first five years of production and c 5.4Moz Ag per year for the first 10 years of production (implying c 4.8Moz Ag per year for the second 10 years of production on average).
• Current declared reserves are sufficient to support mining activities at Antamina until 2036. Multiple options to expand mine infrastructure are under evaluation, which would significantly extend the mine’s life, with measured and indicated resources alone potentially representing approximately a further eight years of mine life (at current rates of extraction) and inferred resources a further 22.9 years. Additional exploration potential also exists both at depth below the current resource pit and regionally.
• WPM will make ongoing payments for the silver ounces delivered equal to 20% of the spot price of silver (the same as for its Glencore stream).
• We estimate that the US$4.3bn upfront consideration will be almost entirely covered by the US$3.6bn that we are forecasting WPM will generate from cash flows from operations in FY26 to leave it with net debt of no more than US$1.1bn as at end-FY26 (depending primarily on its dividend payout), which we calculate will equate to gearing (debt/equity) of 11.0% or leverage (debt/[debt+equity]) of 9.9%.
• The transaction will cement Antamina’s position as Wheaton's second‑largest asset.
• Antamina is the largest copper-zinc skarn deposit in the world and one of the lowest-cost copper mines globally. With its addition to Wheaton’s portfolio, c 76% of WPM’s 2026 production is now forecast to come from mines operating in the first quartile of their respective cost curves, with 85% coming from assets in the lowest half of their respective cost curves.

Given the similarity between the two streams, we have now incorporated the BHP Antamina stream into our financial model of Wheaton on substantially the same terms as the Glencore stream with the single exception that we have assumed an increased depletion charge associated with its production of c US$41.50/oz Ag (cf US$4.39/oz for the Glencore stream) to reflect the higher and more recent consideration paid for the asset. Note that in the first quarter after it was acquired (Q415) the price of silver averaged US$14.07/oz (cf its price of US$84.33/oz at the time of writing).

Guidance for FY26 and beyond

On 16 February, WPM provided detailed production guidance for FY26, which also includes BHP’s Antamina stream and is summarised below relative to the known outcome for FY25 and our updated forecasts for FY26:

In the short term, increases in output will be driven by the newly acquired Antamina and Hemlo streams plus contributions from newly operating assets such as Blackwater, Mineral Park, Fenix, Goose and Platreef, partially offset by some moderation in output from Salobo as higher throughput levels are counteracted by modestly lower gold grades and Constancia following the depletion of the Pampacancha pit in late December 2025.

In the longer term, production is forecast to increase by approximately 50% to 1,200,000 GEOs by 2030, owing to growth from multiple operating assets including Antamina, Blackwater, Aljustrel, Marmato, Hemlo and Goose, development assets that are in construction and/or various stages of ramp-up, including Koné, Fenix, Kurmuk, Platreef, Mineral Park and El Domo, and pre-development assets (all of which have received their major permits) including the Spring Valley, Copper World and Santo Domingo.

From 2031 to 2035, attributable production is forecast to be maintained at c 1,200,000 GEOs annually with additional incremental production from pre-development assets including Cangrejos, Kudz ze Kayah and Marathon, in addition to the Mt. Todd and Black Pine royalties. Not included in Wheaton's long-term forecast, and instead classified as 'optionality', is potential future production from 11 other assets including El Alto, Navidad and Toroparu as well as the potential expansion of Salobo beyond the Salobo III mine expansion project and future stream purchases.

WPM’s guidance for FY26 and beyond is based on standardised pricing assumptions of US$4,800/oz gold (cf US$2,600/oz previously), US$80.00/oz silver (cf US$30.00/oz), US$1,500/oz palladium (cf US$950/oz), US$2,000/oz platinum (cf US$950/oz) and US$25.00/lb cobalt (cf US$13.50/lb). Of note is the updated implied gold/silver ratio of 60.0x, which is a significant reduction relative to the 86.7x previously implied and reflects silver’s recent strong price performance. However, it is closely in line with the 60.1x that this ratio has averaged since gold was demonetised in August 1971:

At the updated standardised prices indicated, Edison’s production forecast of 926.0koz gold equivalent (GEO or AuE) for FY25 is self-evidently within Wheaton’s guidance range of 860–940k GEOs. However, our sales forecast is slightly more conservative, at 844.9k GEOs (cf 651.3k GEOs in FY25e).

Otherwise, readers will note that our longer-term production forecasts are within 6% of WPM’s longer-term guidance, which is well within the recent average quarterly under-sales rate of 10.2% (±8.8%) since Q121.

Quarterly FY26 financial forecasts

At the time of our last update note, published on 7 November 2025, our base case FY26 EPS forecast (at relatively depressed long-term precious metals prices) was US$1.55/share. However, we noted that, if prices at the time were assumed to continue, this would increase to US$3.70/share. In the event, given the revisions considered above as well as subsequent moves in precious metals prices, we have now substantially upgraded our EPS estimate for FY26 to US$5.97/share, as shown below:

As with FY25 estimates, this puts Edison’s updated adjusted basic EPS forecast of US$5.97/share for FY26 at the top end of the range of brokers’ expectations for FY26.

Within this context, it is worth noting the discrepancy between brokers’ expectations for FY26 and ‘Sum Q1–Q426e’ (especially at the bottom end of the range), which suggests that some analysts make quarterly forecasts while some make only annual forecasts.

Valuation

Absolute valuation

WPM is a multi-asset company that has shown a willingness and desire to buy streams in the past to maintain production and maximise shareholder returns. As a result, rather than our customary method of discounting maximum potential dividends over the life of operations back to FY26, in the case of WPM, we discount forecast cash flows back over five years (six years previously) to the start of FY26 and then apply an ex-growth terminal multiple to forecast cash flows in that year (FY30) based on the appropriate discount rate.

In this case, our estimate of WPM’s terminal cash flow in FY30 has increased to US$4.36/share (cf US$3.94/share previously). Assuming 4.0% growth in nominal cash flows beyond FY30 (ie 0.0% growth in real cash flows) and applying a discount rate of 9% (being the expected long-term required nominal equity return), our terminal valuation of the company at end-FY30 is US$90.15, or C$122.49, per share. On this basis, our current valuation of the company would be US$68.02, or C$92.42, per share.

However, this valuation is inherently conservative in that it assumes a (nominal) gold price of US$2,274/oz in FY30 and zero growth in (real) cash flows thereafter. This is inconsistent with the gold price, which has risen at a compound average annual growth rate of 8.2% per year from 1967 to 2025, a simple average annual growth rate of 10.4% per year (cf a compound average inflation rate over the same period of 4.0%) and a compound average real annual growth rate of 4.1% per year.

It is also inconsistent with WPM’s longer-term historical performance, wherein operational cash flows have increased at a compound average annual growth rate of 20.4% per year for the 19 years between FY05 and FY24, while its operational cash flows per share have increased at a compound average annual growth rate of 14.3% per year over the same timeframe.

If we instead assume that cash flows per share increase at a compound average annual growth rate of 8.2% (ie the average compound average annual growth rate in the gold price from 1967 to 2025, cf 4.0% above), then our terminal valuation of WPM increases manyfold to US$616.53/share, or C$837.69/share, and our current valuation to US$410.14/share, or C$557.25/share.

Stated alternatively, WPM’s current share price of C$202.02 appears to be discounting future compound annual average increases in cash flow per share of just 6.8% per year from FY30, which is only modestly higher than the long-term average rate of US inflation of 4.0% per year from 1967 to 2025 (inclusive).

A summary of these valuations with respect to their cash flow growth rate assumptions is as follows:

An alternative interpretation is that the market is assuming currently prevailing precious metals prices up to and including FY30, in which case WPM’s share price of C$202.02 could be interpreted as discounting compound annual average increases in cash flows per share thereafter of just 3.4% per year.

Historical valuation

Excluding FY04 (part-year), WPM’s shares have historically traded on an average P/E multiple of 31.2x current year basic underlying EPS, excluding impairments (cf 49.8x Edison and 52.3x LSEG Data & Analytics consensus FY25e currently, see Exhibit 17).

Applying this 31.2x multiple to our EPS forecast of US$3.51 in FY27 (cf US$1.94/share previously) implies a potential value per share for WPM of US$109.68 or C$150.53 in that year. However, it is also notable that Edison’s forecast metals prices in that year currently are only US$2,239/oz Au and US$60.00/oz Ag (cf US$25.30/oz Ag previously). At current prices, our EPS forecast of US$3.51/share in FY27 instead rises to US$7.54/share, in which case our equivalent valuation would rise to US$235.26, or C$322.87, per share (or WPM’s P/E would fall to 19.7x – see Exhibit 17, below). Moreover, as can be observed from the graph above, during periods of precious metal price appreciation, WPM can command current year P/E multiples that average 38.0x (eg between 2018 and 2024) and can rise as high as 45.0x (eg 2019).

Relative valuation

WPM is maintaining its premium rating relative to its peers. However, it appears good value if current metals prices continue for at least three years (the WPM (Edison at spot prices) row in Exhibit 17), in which case it is then cheaper than its peers on 48% of valuation measures (13 out of 27 measures in the table below) and 55% (five out of nine) average measures.

Readers will note our relatively high year 3 P/E ratio, which arises from our relatively low precious metals forecasts of US$2,239/oz Au and US$60.00/oz Ag. As noted previously, if metals prices remain at current levels, our FY27 EPS estimate rises to US$7.54/share, in which case the corresponding P/E ratio falls to 19.7x, which is at a marked discount to both consensus and its peer group. In the meantime, the similarity between the year 2 and year 3 consensus P/E ratios for Wheaton suggests that the market is anticipating that precious metals prices will fall in FY27, but only to such an extent as to approximately offset production growth. If precious metals prices remain flat (or increase) and production grows as expected by management, WPM also appears inexpensive relative to historical multiples.

Financials: US$1,149.7m in net cash at end Q3

As at 30 September, WPM had US$1,157.7m in cash on its balance sheet and no debt outstanding under its US$2bn revolving credit facility. Including a modest US$8.0m in lease liabilities, it therefore had US$1,149.7m in net cash after generating US$383.0m in operating cash flow, disbursing a net US$158.6m in investing activities and paying out US$74.2m in dividends.

In FY25 as a whole, we estimate that it will generate US$1,869.8m from operating activities, before consuming a net US$1,238.7m in net investing activities and paying out an increased US$299.6m in forecast dividends under the influence of its new, progressive dividend policy. However, readers should note that the timing of PMPA payments is uncertain and to the extent that investments may have been advanced or delayed (especially regarding Kurmuk, Hemlo and/or Sun Valley), it is possible that WPM could register either a larger or smaller net cash position on its balance sheet by the year-end than that forecast.