On Aug. 9, Silver Wheaton Corp. (SLW) closed at $29.75 per share from $29.22 per share the day before, up 53 cents (+1.81%), with 3,370,602 shares traded on the New York Stock Exchange. The stock is uptrending and gained 138% year to date.
Silver Wheaton planned to release its second-quarter financial results after market close Aug. 10.
Analysts expect earnings per share (EPS) to be between 19 cents (high) and 10 cents (low) or between +46.2% (6 cents) and -23.1% (-3 cents) from last year's 13 cents per share.
Source: Yahoo Finance
The company has 440.21 million shares outstanding, and its profit will range between $83.6 million and $44 million if the analysts’ estimates on EPS become reality.
Source: Yahoo Finance
Analysts forecast revenue to be in the range of $217.76 million and $166 million, or between 32.4% (up $53.32 million) and 0.9% (up $1.56 million) from last year's sales of $144.44 million.
After 10 cents actual earnings per share reported by Silver Wheaton for the previous quarter, analysts now forecast 7.70% growth for the current quarter and 75.00% for the next quarter:
Source: Yahoo Finance
EPS trend has been flat over the last 90 days and revised up one time in the last seven days, three times in the last 30 days and revised down four times in the last 30 days.
Source: Yahoo Finance
Analysts’ recommendation rating is 1.9. The recommendation rating ranges between 1 (strong buy) and 5 (sell). The average analysts’ price target is $31.73 (high target: $35.00; low target price: $27.66).
In the first quarter Silver Wheaton reported EPS of 10 cents and missed analysts' expectations on EPS by 2 cents. Sales were $187.51 million, an increase of 44% compared to the first quarter of 2015.
During the first quarter attributable silver equivalent production and attributable silver equivalent sales volume increased 24% and 65% while the average cash costs on a silver equivalent basis decreased with 0.45% year over year (from $16.90 in the first quarter of 2015 to $14.70 in the first quarter). In the first quarter the average realized sale price of each silver equivalent ounce sold was down 13% year over year; therefore the cash operating margin per silver equivalent ounce decreased 18% to $10.26 in the first quarter from $12.44 in the first quarter of 2015.
On Aug. 2, Silver Wheaton agreed to acquire from a subsidiary of Vale SAĂ‚ (VALE, Financial) an additional amount of gold equal to 25% of the life of mine gold production from its Salobo mine, located in Brazil, entitling the silver streamer to 75% of the life-of-mine gold production from the mine. Silver Wheaton will pay upfront cash consideration of $800 million for the increased gold stream.
Since the silver streaming companies don’t have any control over the mines that produce their silver, earnings are based entirely on silver's market price.
Silver Wheaton will continue to uptrend as silver trades higher. The postponement of interest hikes by the Fed and the uncertainty that dominates in the financial markets are putting more pressure on the price of precious metals.
Enterprise value/EBITDA is 31.17 and price-book (P/B) is 2.88.
Disclosure: I have no positions in Silver Wheaton.
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