Wheaton Precious Metals Corp (WPM)

[SsMurry]

Neutral impact for SLW
Daniel Earle has sent out an analysis report on SLW. Silver Wheaton reported Q3/14 EPS of $0.20, which was slightly below both consensus of $0.22 and Daniel Earle's estimate of $0.23, due to a lower realized silver price and higher depreciation

Silver-equivalent production totaled 8.4 Moz at cash costs of $4.59/oz (Daniel Earle had forecasted 9.1 Moz at $4.65/oz); The company will need to produce 10.2 Moz in Q4/14 to meet its annual guidance of 36.0 Moz

The company declared a quarterly dividend of $0.06/share, as expected and the company’s cash position increased by approximately $94mm to $233mm in the quarter

Daniel Earle forecasts the company's operating cash flow to be in the range of $420mm to $540mm per year over the next few years (at $15.50/oz silver) and he currently only model $230mm of capex payments for the remainder of 2014 and 2015

Silver Wheaton is currently trading at 1.21x NAV5% and 13.8x 2015E CFPS, which is a meaningful discount to what Daniel Earle views as its closest peer, Franco-Nevada Corp. (FNV-T), which trades at 1.78x NAV5% and 20.8x 2015 CFPS

With SLW's strong balance sheet and access to capital, the company is well positioned to continue to complete attractive transactions and further its business model, in Daniel Ear;e's view. Daniel Earle maintains his BUY recommendation.