Wheaton (WPM) Q4 Earnings & Sales Miss Estimates, Down Y/Y

Wheaton Precious Metals Corp. WPM reported adjusted earnings per share (EPS) of 29 cents in fourth-quarter 2021, missing the Zacks Consensus Estimate of 30 cents. The bottom line declined 12% year over year.The company generated revenues of $278 million during the reported quarter, down 3% on a year-over-year basis. The downside was caused by a 5% decline in the average realized gold equivalent price, partly offset by a 2% increase in the number of Gold Equivalent Ounces (GEOs) sold. The top line also missed the Zacks Consensus Estimate of $285 million.Wheaton’s gold production was 88,321 ounces, down from the prior-year quarter’s 92,039 ounces. Attributable silver production declined 2.4% year over year to 6,356 ounces and palladium production declined 17% to 4,733 ounces. The company sold 158,864 GEOs during the December-end quarter, up 2% from the prior-year quarter’s 155,665 GEOs.

Wheaton Precious Metals Corp. Price, Consensus and EPS SurpriseWheaton Precious Metals Corp. Price, Consensus and EPS Surprise

Wheaton Precious Metals Corp. price-consensus-eps-surprise-chart | Wheaton Precious Metals Corp. Quote

Prices

In fourth-quarter 2021, the average realized gold price was $1,798 per ounce. The figure was 4.5% lower than the year-ago quarter’s figure. Silver prices averaged $23.36 per ounce in the reported quarter, down 5.5% year on year. Palladium prices fell 18.3% year over year to $1,918 per ounce.

Financial Position

The company had $226 million of cash in hand at the end of 2021 compared with $193 million at the 2020-end. It recorded an operating cash flow of $845 million in 2021 compared with $765 million in 2020. The company fully paid a revolving credit facility of $2 billion.During the fourth quarter, the company announced a quarterly dividend of 15 cents per share, reflecting an increase of 25% from the year-ago quarter’s levels.

Business Update

On Dec 14, Wheaton entered into a new precious metals purchase agreement (PMPA) with Artemis Gold Inc. to acquire silver production from Blackwater Gold Project. The company also entered into an agreement with New Gold Inc. NGD to acquire the existing gold stream from the project. Wheaton will pay New Gold an upfront consideration of $300 million after the gold stream deal’s closure. The company will pay Artemis a total cash consideration of $141 million, payable in four equal installments during the construction of the Blackwater Project.On Dec 22, Wheaton entered into a PMPA with Generation Mining Limited in relation to acquiring gold and platinum production from the Marathon Project.On Jan 17, 2022, Wheaton entered into another PMPA with Alliance Metals International, a subsidiary of Adventus Mining Corporation, to acquire gold and silver streams from the Adventus Curipamba Project.

2021 Performance

Wheaton reported an adjusted EPS of $1.32 in 2021 compared with $1.12 reported in the prior year. Earnings meet the Zacks Consensus Estimate.Sales were up 9.6% year over year to a record $1.20 billion. The top line missed the Zacks Consensus Estimate of $1.21 billion.

Guidance

Wheaton’s attributable production is estimated between 700,000 GEOs and 760,000 GEOs for the current year. Gold production is expected in the band of 350,000-380,000 ounces. Silver production is projected between 23.0 million ounces and 25.0 million ounces, while production of other metals is anticipated in the band of 44,000-48,000 GEOs.

Price Performance

Shares of Wheaton have gained 26.1% in the past year compared with the industry’s growth of 13.1%.

Zacks Investment Research

Image Source: Zacks Investment Research

Zacks Rank & Stocks to Consider

Wheaton currently carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the basic materials space include Teck Resources TECK and Cabot Corporation CBT, both sporting a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.Teck Resources has a projected earnings growth rate of 26.1% for the current year. The Zacks Consensus Estimate for TECK's current year earnings has been revised upward by 33% in the past 60 days.Teck Resources beat the Zacks Consensus Estimate for earnings in three of the trailing four quarters and missed once, the average surprise being 13%. TECK’s shares have surged around 95% in a year.Cabot has a projected earnings growth rate of 15.5% for fiscal 2022. The Zacks Consensus Estimate for CBT’s fiscal 2022 earnings has been revised upward by 8% in the past 60 days.Cabot beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average surprise being 21.6%. CBT has rallied around 49% in a year.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cabot Corporation (CBT) : Free Stock Analysis Report New Gold Inc. (NGD) : Free Stock Analysis Report Teck Resources Ltd (TECK) : Free Stock Analysis Report Wheaton Precious Metals Corp. (WPM) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research

By Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

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