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Silver Wheaton shares up after record 2016; Eight Capital rates shares ‘buy’
Silver Wheaton Corp (TSE:SLW, NYSE:SLW) saw shares add over 7% on Wednesday after it posted record revenue and sales volumes in 2016.
Revenues for the year came in at $892 million for the year, compared with $649 million in 2015 - an increase of 37%. The firm has also proposed a name change to Wheaton Precious Metals.
Production for the year to end December was of 30.4 million ounces of silver and 353,700 ounces of gold, compared with 30.7 million ounces of silver and 243,000 ounces of gold in 2015 – a record increase for gold output.
In the fourth quarter, adjusted net earnings were $82 million, or $0.19 per share, compared with $57 million ($0.14 per share) in the final quarter of 2015 representing an increase of 43%.
Broker Eight Capital said that was above its estimate of $0.17 per share and consensus of $0.16 per share.
Fourth quarter silver equivalent ounce (SEO) production and sales exceeded the broker’s estimates by 10% and 9% respectively, resulting in healthy FCF (free cash flow) generation, the broker said.
Guidance in 2017 and on a 5-year basis is largely in line with plan, where higher 2017 Antamina and Salobo mine guidance offsets a weaker performance from San Dimas, Sudbury, and Constancia, says analyst Josh Wolfson.
The broker rates shares a ‘buy’ and targets C$36 each.
Shares in Toronto are up 7.49% to stand at C$28.55 each.
The broker’s 12-month target price of $36.00 is based on 1.7 times’ its target NAV (net asset value) at a long term gold price of $1,300 per ounce, it said.
“This is in line with its peers due to its high quality portfolio, partially offset by NAV concentration and tax uncertainties,” said Wolfson.
Story by ProactiveInvestors
Source: http://www.proactiveinvestors.com/companies/news/175246/silver-wheaton-shares-up-after-record-2016-eight-capital-rates-shares-buy--175246.html
