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Wheaton Precious Metals - A solid start

Wheaton Precious Metals’ (WPM’s) Q121 results were characterised by record quarterly revenue, the repayment of the group’s revolving credit facility and a third successive increase in the quarterly dividend (to US$0.14/share). In a departure from recent trends, it was the silver division that led the way in terms of increased production and sales as the gold division lagged, principally as a result of lingering coronavirus induced disruptions at Salobo. Adjusted EPS of US$0.358 was consistent with our prior forecast and well within the range of analysts’ expectations of US$0.32–0.43/share. In the aftermath of the results, we have upgraded our adjusted EPS forecast for WPM for FY21 by 4.0%, albeit this largely reflects the recent strength in metals prices rather than expectations of production growth. Should our forecasts for the full year be borne out, we calculate that WPM will distribute more in dividends in FY21 than it earned in FY19.