{"id":48557,"date":"2023-08-15T06:48:35","date_gmt":"2023-08-15T10:48:35","guid":{"rendered":"https:\/\/ifintechworld.com\/news\/wheaton-precious-metals-salobo-made-the-difference-this-quarter-nysewpm\/"},"modified":"2023-08-15T06:48:47","modified_gmt":"2023-08-15T10:48:47","slug":"wheaton-precious-metals-salobo-made-the-difference-this-quarter-nysewpm","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=48557","title":{"rendered":"Wheaton Precious Metals: Salobo Made The Difference This Quarter (NYSE:WPM)"},"content":{"rendered":"
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Introduction<\/h2>\n

The Canadian company Wheaton Precious Metals Corp.<\/strong> (NYSE:WPM<\/span>) released its second-quarter 2023 results on August 10, 2023.<\/p>\n

Note: This article updates my previous article published on June 30, 2023. I have been following WPM quarterly results since Sep. 2018.<\/p>\n

WPM has 19 operating mines<\/strong> and 13 development projects<\/strong> throughout the Americas, unchanged from 1Q23.<\/p>\n

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\"Map\"
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WPM Assets Map (WPM Presentation)<\/p>\n<\/figcaption><\/figure>\n<\/p>\n

1 – A quick snapshot of the second quarter of 2023<\/strong><\/h3>\n

The company generated revenues of $264.97 million<\/strong> during 2Q23, down 12.5% year-over-year. The adjusted Income was $143 million<\/strong>.<\/p>\n

Wheaton Precious Metals reported an operating cash flow of $202.38 million<\/strong> in the second quarter of 2023, compared with $215.38 million in the second quarter of 2022.<\/p>\n

The company produced 147,699 GEOs in 2Q23<\/strong>, down from the prior-year quarter’s 156,570 GEOs, and sold 138,835 GEOs<\/strong>.<\/p>\n

The average annual production guidance for 2023 of <\/span>600K to 660K GEOs<\/strong> is maintained, with sector-leading growth resulting in five and ten-year average annual production guidance of approximately <\/span>810K and 850K GEOs<\/strong>.<\/span><\/p>\n

CEO Randy Smallwood said in the conference call:<\/p>\n

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Our strong performance was underscored by significant progress at the recently commissioned expansion at our largest asset, Salobo, the ramp-up of which we expect to continue throughout 2023. And despite operations at Pe\u00f1asquito being suspended in early June due to a labour dispute, we achieved quarter-over-quarter gold-equivalent production growth, highlighting the resilience of our high-quality, diversified portfolio.<\/p>\n<\/blockquote>\n

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\"Table\"<\/span>
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WPM 2Q23 Highlights (WPM Presentation)<\/p>\n<\/figcaption><\/figure>\n<\/p>\n

2 – Stock performance<\/strong><\/h3>\n

Wheaton Precious Metals and Franco-Nevada (FNV) are my long-term core streamers. WPM has outperformed its peers and is up 30%<\/strong> on a one-year basis. Sandstorm Gold (SAND) continues to underperform the group.<\/p>\n

I strongly recommend reading my recent article on SAND by clicking here.<\/p>\n

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\"Chart\"
Data by YCharts<\/figcaption><\/figure>\n<\/p>\n

3 – Investment Thesis<\/strong><\/h3>\n

WPM is one of my long-term investments in the royalties & streams segment with Franco-Nevada. I also own a small long-term position with Sandstorm Gold that I trade more frequently.<\/p>\n

Wheaton Precious Metals Corp. is highly correlated to the gold price, representing 56.4%<\/strong> of the total revenues 2Q23.<\/p>\n

Unfortunately for gold, Jerome Powell hinted that it would be necessary to hike interest rates another 25 points before the end of 2023 due to a surprisingly resilient economy encouraging higher inflation.<\/p>\n

Despite this not-so-good short-term forecast, the gold price has traded above $1,900 per ounce until now, which is positive. Gold will probably trade between $1,875 and $1,950 per ounce for the remainder of 2023 unless something new and serious happens.<\/p>\n

However, I assume the FED will signal a definitive pause early next year, boosting gold to a range of $2,000 and $2,100 per ounce.<\/p>\n

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\"Chart\"<\/span>
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WPM 1-Year Chart Gold, Silver, Copper (Fun Trading StockCharts)<\/p>\n<\/figcaption><\/figure>\n<\/p>\n

Thus, the best strategy to respond to such a trend is regularly trading short-term LIFO<\/strong>, at least 30%-40%<\/strong> of your long-term position.<\/p>\n

Wheaton Precious Metals: Financials And Production History ending in 2Q23<\/h2>\n

Note: All numbers are in US$<\/strong><\/p>\n

<\/span><\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n<\/colgroup>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Wheaton Precious<\/strong><\/td>\n2Q22<\/strong><\/td>\n3Q22<\/strong><\/td>\n4Q22<\/strong><\/td>\n1Q23<\/strong><\/td>\n2Q23<\/strong><\/td>\n<\/tr>\n
Total Revenues in $ Million<\/td>\n302.92<\/td>\n218.84<\/td>\n236.05<\/td>\n214.47<\/td>\n264.97<\/td>\n<\/tr>\n
Net Income in $ Million<\/td>\n149.07<\/td>\n196.46<\/td>\n166.13<\/td>\n111.39<\/td>\n141.45<\/td>\n<\/tr>\n
EBITDA $ Million<\/td>\n210.74<\/td>\n264.62<\/td>\n207.31<\/td>\n151.58<\/td>\n202.44*<\/td>\n<\/tr>\n
EPS diluted in $\/share<\/td>\n0.33<\/td>\n0.43<\/td>\n0.38<\/td>\n0.25<\/td>\n0.31<\/td>\n<\/tr>\n
Cash from operating activities in $ Million<\/td>\n206.36<\/td>\n154.50<\/td>\n172.03<\/td>\n135.10<\/td>\n202.38<\/td>\n<\/tr>\n
Capital Expenditure in $ Million<\/td>\n\n

15.55<\/p>\n<\/td>\n

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47.56<\/p>\n<\/td>\n

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-87.45<\/p>\n<\/td>\n

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32.30<\/p>\n<\/td>\n

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88.71<\/p>\n<\/td>\n<\/tr>\n

Free Cash Flow in $ Million<\/td>\n\n

190.81<\/p>\n<\/td>\n

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106.93<\/p>\n<\/td>\n

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259.48<\/p>\n<\/td>\n

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102.80<\/p>\n<\/td>\n

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113.67<\/p>\n<\/td>\n<\/tr>\n

Total cash $ Million<\/td>\n448.63<\/td>\n494.62<\/td>\n696.09<\/td>\n799.70<\/td>\n828.84<\/td>\n<\/tr>\n
Long-term debt in $ Million<\/td>\n0.0<\/td>\n0.0<\/td>\n0.0<\/td>\n0.0<\/td>\n0.0<\/td>\n<\/tr>\n
Dividend per share in $<\/td>\n0.15<\/td>\n0.15<\/td>\n0.15<\/td>\n0.15<\/td>\n0.15<\/td>\n<\/tr>\n
Shares outstanding (diluted) in Million<\/td>\n452.4<\/td>\n452.39<\/td>\n452.71<\/td>\n453.16<\/td>\n453.58<\/td>\n<\/tr>\n
Production details<\/strong><\/td>\n2Q22<\/strong><\/td>\n3Q22<\/strong><\/td>\n4Q22<\/strong><\/td>\n1Q23<\/strong><\/td>\n2Q23<\/strong><\/td>\n<\/tr>\n
Production in Gold Equivalent K Oz GEO<\/td>\n162.6<\/td>\n159.9<\/td>\n148.3<\/td>\n141.8<\/td>\n147.7<\/td>\n<\/tr>\n
Gold price realized $\/Oz<\/td>\n1,795<\/td>\n1,728<\/td>\n1,725<\/td>\n1,904<\/td>\n1,986<\/td>\n<\/tr>\n
Silver price realized $\/Oz<\/td>\n23.71<\/td>\n19.16<\/td>\n21.52<\/td>\n22.85<\/td>\n24.13<\/td>\n<\/tr>\n
The gold\/silver ratio<\/td>\n75.0<\/td>\n90.2<\/td>\n80.2<\/td>\n83.3<\/td>\n82.3<\/td>\n<\/tr>\n<\/table>\n

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