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Edison Investment Research Limited
 London, UK, 23 March 2020 Edison issues outlook on Wheaton Precious Metals (WPM) Attributable production of gold at Wheaton Precious Metals (WPM) reached a record in FY19, breaching the 400koz level for the first time ever. Record production begat record sales, although sales struggled to keep pace with production and, as a result, there was a slightly uncharacteristic (for the fourth quarter) increase in the number of ounces of metal produced but not yet delivered to WPM from its underlying streaming assets. From a financial perspective however, underlying net earnings during the quarter were within US$1m of our prior forecasts, auguring well for FY20 in terms of both EPS and DPS.  We have honed our EPS forecasts to 65c for FY20 and to 113c for FY21 in the wake of the recent turmoil in the precious metals markets. Assuming no material purchases of additional streams (which we think unlikely), we forecast a value per share for WPM of US$33.38, or C$48.47, in FY21. This valuation excludes the value of 20.2m shares in First Majestic held by WPM, with an immediate value of C$150.2m, or US$0.23 per WPM share. In the meantime, WPM's shares are trading on near-term financial ratios that are cheaper than those of its royalty/streaming 'peers' in at least 54% of financial measures considered in Exhibit 11, and the miners themselves in at least 26% of the same measures, despite being associated with materially less operating and cost risk.
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