Wheaton Precious Metals WPM reported adjusted earnings per share of 44 cents in fourth-quarter 2024, in line with the Zacks Consensus Estimate. The bottom line increased 21% year over year.
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Including an impairment charge related to Voisey’s Bay agreement due to a significant and sustained decline in market cobalt prices, WPM reported earnings per share of 19 cents compared with 37 cents in the fourth quarter of 2023.
Wheaton Precious Metals Corp. Price, Consensus and EPS Surprise
Wheaton Precious generated record revenues of around $381 million in the quarter, which rose 21.4% on a year-over-year basis. A 32% gain from the higher average realized gold equivalent price was offset by an 8% decline in gold equivalent ounces (GEOs) sold in the quarter. The top line beat the Zacks Consensus Estimate of $374 million.
Gold sales contributed around 62% to the quarter’s revenues. Silver contributed 35% to the company’s revenues, palladium accounted for 1% and cobalt contributed 2%.
In fourth-quarter 2024, the average realized gold price was $2,677 per ounce. The figure was 33.4% higher than the year-ago quarter. Silver prices were $31.28 per ounce, up 31.6% year over year. Palladium prices were $1,008 per ounce, down 6% from the prior-year quarter. Cobalt prices rose 6% year over year to $13.66 per pound.
WPM’s Gold Equivalent Production Rises, Sales Drop in Q4
Gold production in the fourth quarter was 117,526 ounces, a 4.1% increase year over year. The figure beat our gold production projection of 94,061 ounces for the quarter.Silver production rose 36.5% year over year to 5,740 thousand ounces, which came in higher than our estimate of 5,084 thousand ounces.
Attributable gold equivalent production in the quarter was 187,493 ounces, up 13.8% from the prior-year quarter’s output of 164,796 ounces. Our projection was 155,248 ounces. The outperformance was due to higher production from Salobo and Peñasquito.
The company sold 142,561 GEOs in the quarter, down 8% year over year.
WPM’s Margins Rise Y/Y in Q4
The total cost of sales was down 5.2% year over year to around $64.2 million in the fourth quarter. The gross profit was up 39.6% to $247 million. The gross margin was 65% in the reported quarter compared with 56.5% in the prior-year quarter.
General and administrative expenses increased 13% year over year to $10.5 million. Earnings from operations were $117.6 million, a 26.1% decrease from $159 million in the fourth quarter of 2023. This included the impact of the impairment charge of around $109 million.
Average cash costs in the fourth quarter of 2024 were $441 per GEO, up from $437 in the year-ago quarter. The cash operating margin increased 41% year over year to $2,228 per GEO sold due to a higher realized price per ounce.
Wheaton Precious’ Balance Sheet Updates
Wheaton Precious had around $818 million of cash in hand at the end of 2024 compared with $547 million at the end of 2023. The company reported an operating cash flow of $1.03 billion in 2024 compared with $0.75 billion in 2023.
WPM had a debt-free balance sheet as of Sept. 30, 2024. The company has a $2-billion undrawn revolving credit facility.
WPM’s Performance in 2024
Wheaton Precious reported adjusted earnings per share of $1.41 in 2024, marking a 20% year-over-year increase. The bottom line, however, missed the Zacks Consensus Estimate of $1.45.
Including one-time items, WPM reported earnings per share of $1.17 compared with $1.19 in 2023.
Wheaton Precious generated revenues of around $1.28 billion in the quarter, which rose 26.4% on a year-over-year basis. The year-over-year increase was attributed to higher average realized gold equivalent price and increased gold equivalent ounces (GEOs) sold during the year. The top line missed the Zacks Consensus Estimate of $1.29 billion.
Attributable gold equivalent production was 635,000 GEOs for the full year of 2024.
WPM’s 2025 Outlook
Gold production is expected to be in the band of 350,000-390,000 ounces. Silver production is projected between 20.5 million and 22.5 million ounces. The production of other metals is anticipated to be in the band of 12,500-13,500 GEOs.
Wheaton Precious projects an attributable production of 600,000-670,000 GEOs. The midpoint of the range suggests a 10% year-over-year increase in production. This factors in higher attributable production from Antamina, the start-up of several development projects (Blackwater, Goose, Mineral Park and Platreef) and a stable forecast for Salobo production. However, this will be somewhat offset by lower production from Peñasquito and Constancia. The company has targeted 870,000 GEOs in 2029.
Wheaton Precious’ Price Performance
WPM shares have gained 72.2% in the past year against the industry’s 4.5% decline.
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Wheaton Precious’ Peer Performances
Franco-Nevada Corporation FNV reported adjusted earnings of 95 cents per share in fourth-quarter 2024, beating the Zacks Consensus Estimate of 89 cents. The bottom line increased 6% year over year.
FNV generated revenues of $321 million in the reported quarter, marking a year-over-year increase of 6%. The upside was driven by record gold prices and strong production from Candelaria. In the December quarter, 79.2% of revenues were sourced from Precious Metal assets (65.9% gold, 11.3% silver and 2% platinum group metals).
WPM’s Zacks Rank & Key Picks
Wheaton Precious currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Better-ranked stocks in the basic materials space are Carpenter Technology Corporation CRS and ArcelorMittal MT.
Carpenter Technology currently carries a Zacks Rank #2 (Buy). CRS beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 15.7%. The company's shares have soared 178.9% in the past year.
The Zacks Consensus Estimate for ArcelorMittal’s current-year earnings is pegged at $3.72 per share. MT, which carries a Zacks Rank of 2, surpassed the Zacks Consensus Estimate in three of the trailing four quarters but missed in one, with an average earnings surprise of 4.11%. The company's shares have rallied 21.8% in the past year.
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