Wheaton Precious Metals is set to report its Q1 2024 results, with revenue expected to come in at around $285 million, a 33% increase from the previous year. Earnings are projected to be around $0.30 per share, slightly ahead of consensus estimates. The company faced production challenges in 2023, but is looking at increased production for 2024, driven by stronger output from the Peñasquito mine and Voisey’s Bay. However, lower output from the Salobo mine may partially offset these gains. The company is also benefiting from high gold prices, which have been trading near all-time highs.
Wheaton Precious Metals stock has shown strong gains over the past few years, outperforming the S&P 500. However, the stock’s performance has been inconsistent, with returns of 3% in 2021, -9% in 2022, and 26% in 2023. Despite these fluctuations, the stock has outperformed the benchmark index over the same period. The current macroeconomic environment, including high oil prices and elevated interest rates, could impact the company’s performance in the next 12 months. Precious metals prices are expected to remain strong due to easing inflation and global economic concerns, potentially benefiting Wheaton Precious Metals.
Despite short-term production declines, Wheaton Precious Metals is anticipating increased production volumes in the long run. The company is aiming for an average production of 800,000 GEOs by 2028 and over 850,000 GEOs from 2029 to 2033, marking a significant increase compared to 2023. However, the stock is trading at a high multiple of 48x consensus 2024 earnings, leading to concerns about its valuation. Trefis estimates the company’s valuation at $40 per share, which is below the current market price. The company’s business model and key revenue streams will be reevaluated following the upcoming earnings release.
Investors are keeping a close watch on Wheaton Precious Metals as it prepares to announce its Q1 2024 results. With expectations of increased revenue and earnings, the company’s performance in the coming quarter will be crucial in determining its future trajectory. The high prices of precious metals, along with the company’s plans for increased production, are expected to drive its performance in the long run. However, concerns about the company’s valuation and potential macroeconomic challenges could impact its stock performance in the near term. The market will be closely monitoring Wheaton Precious Metals as it navigates these opportunities and risks.
