Wheaton Precious Metals (TSX: WPM)

Currency in CAD

Last close As at 06/02/2023

CAD59.59

−1.29 (−2.12%)

Market capitalisation

CAD27,516m

Wheaton Precious Metals is the world’s pre-eminent ostensibly precious metals streaming company, with over 30 high-quality precious metals streams and early deposit agreements over mines in Mexico, Canada, Brazil, Chile, the US, Argentina, Peru, Sweden, Greece, Portugal and Colombia.

Wheaton’s shares are trading on near-term financial ratios that are lower than those of its peers on 63% of common valuation measures which otherwise imply a share price in 2022 of US$34.11, or C$46.13 or £30.20 (based on Edison forecasts). Using a CAPM-type methodology, we calculate a terminal value for Wheaton of US$55.35 (C$74.87) per share in FY26. Alternatively, if precious metals return to favour, then we believe that a near-term valuation of US$43.63 (C$59.02 or £38.63) per share is possible. In addition, Wheaton has US$492.5m (US$1.09/share) in net cash on its balance sheet as at end-Q322.

Equity Analyst

Lord Ashbourne

Lord Ashbourne

Director, Energy & Resources

Key Management

  • Gary D. Brown

    CFO

  • Jacy Zerb

    Director, Investor Relations

  • Patrick Drouin

    SVP, Investor Relations

  • Randy V. J. Smallwood

    CEO

Balance Sheet

Forecast net cash (US$m)

494.9

Forecast gearing ratio (%)

N/A

Share Price Performance

Price Performance
% 1M 3M 12M
Actual 12.7 39.0 15.7
Relative 5.3 29.2 19.2
52 week high/low C$64.7/C$39.1

Financials

Wheaton Precious Metals produced 159,852 gold equivalent ounces (GEOs) in Q322, of which it sold 138,824 GEOs, representing a positive variance of 2.8% and a negative variance of 0.7% relative to our prior estimates, respectively. Its adjusted net earnings were US$1.4m, or 1.6%, above our prior forecast at US$93.9m and the fourth quarterly dividend for the year was maintained at US$0.15/share.

Y/E Dec Revenue (US$m) EBITDA (US$m) PBT (US$m) EPS (c) P/E (x) P/CF (x)
2020A 1096.2 763.8 503.2 112.0 39.5 25.3
2021A 1201.7 852.7 592.1 132.0 33.5 23.4
2022E 1094.6 759.0 505.6 113.0 39.1 25.2
2023E 1354.2 970.9 662.8 147.0 30.1 20.5

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