Stockchase Opinions

Jaime Carrasco Wheaton Precious Metals WPM-T DON'T BUY Feb 21, 2020

He bought them a long time ago and sold with profit. They would be in the same class as Franco-Nevada. WPM is not going to finance anymore. The cashflow is what it is and there will be little upside since it is a royalty company. He would prefer Franco-Nevada. He would look elsewhere where you can get appreciation.

$43.030

Stock price when the opinion was issued

metal mines
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WAIT
WPM vs. FNV He doesn't have a strong preference. You have to wait to see what happens with the commodity. That's your first decision. Once that's done, you look around for valuations. FNV is the go-to stock. WPM has great leverage once they start to torque up. Six of one, half a dozen of the other. Look at valuations and decide which one you think is cheapest.
TOP PICK

World's best precious metals company.
Leverage to mining upside.
Very positive view on high quality asset class.
$69 price target on share price.
Expecting further growth.
Gold is a safe haven against interest rate hikes.
High exposure to silver which is used in EV manufacturing.

PAST TOP PICK
(A Top Pick Mar 10/23, Up 10%)

World's premier precious metals company.
Less risk thank traditional mining companies.
High margins & diversified business.
Expecting gold prices to rise with weak US Dollar & lower interest rates. 

TOP PICK

It should at least return to previous highs around $61, but possibly $70 if gold continues to do well.

(Analysts’ price target is $73.14)
PAST TOP PICK
(A Top Pick Aug 01/23, Up 0.1%)

It's been sideways for a few years, but finding support at current levels. He sees lots of upside. He's been buying in three tranches. But if it doesn't rise, he will sell it. 

BUY

Excellent company for gold exposure. Ranks 9/10 for portfolio. Bullish on gold outlook. Excellent fundamentals. Will continue to buy and hold. 

WEAK BUY

Unsure on whether stock will rise in commodity price increase. Would wait before buying. Overall, is heading in the right direction. Would wait before more strength before buying. 

PARTIAL SELL

From a trade perspective, a bit overbought. He's a trader at heart, and buys into dips. If you're a bull, by all means keep holding. But he took some $$ off the table.

Likes both gold and silver here. Gold and silver equities and exposure to them are very undervalued relative to long-term trends; analysts tell him it's likely going to stay that way for a while. The market just doesn't believe that gold and silver prices are going to remain elevated. 

BUY

Gold is almost like an insurance policy. Good diversifier. Should be a good, long-term hedge. Deposits have become harder to find. 

He prefers the business model of the royalty companies like FNV or WPM. As well, they operate counter-cyclically -- give money when gold prices are low and harvest when prices are high. Always looks expensive, but it's expensive for a reason.

PAST TOP PICK
(A Top Pick Mar 10/23, Up 95%)

Stable, long-term cashflow. Zero debt and huge line of credit give it lots of flexibility to grow. Sees a 6.5% increase in dividend. Big projects are moving forward. Sees 4-5% upside, but she has been trimming to rebalance.