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Silver Wheaton Corp. Message Board

  • investora2z investora2z Jun 5, 2013 7:00 AM Flag

    Much quieter now

    Analysts are expecting relatively better performance from streaming companies like Silver Wheaton compared with the gold & silver mining companies. This is mainly because the company operates with a lower risk model, has higher profit margins, and has good growth prospects. The company has been adversely affected by the change in fortunes for sector due to lower prices, but the impact has be less severe. In fact, the bounce is likely to be stronger for stocks like Silver Wheaton whenever there is a sustained improvement in the sentiments surrounding the sector. The hedge funds are also relatively positive on the stock at current price levels. As per a SA article, the mean price target for the stock is around $40 and the lowest target is $33. This indicates a significant potential for upside from current levels. The company has recently contracted with a Vale subsidiary for 25% of the gold production in perpetuity from the Salobo Mine in Brazil and 70% of the gold production for 20 years from some of the Sudbury Mines in Canada. These acquisitions will help the company in the long run as the sentiments for the sector improve. The acquirers are getting a good deal from these companies in the current market scenario. Development stage companies like Pershing Gold Corporation (PGLC) are looking for investors to fund their production / development endeavors and investors are interested due to the cheap valuations. In fact, Coeur D'Alene hinted at acquiring more stake in such companies surrounding its properties in Nevada. When everybody is busy predicting more gloom and disaster, several big companies are following this strategy quietly. All get carried away with the sentiments and hope for extreme outcomes, whereas usually, the fall and the gloom reverses as suddenly as it starts. Difficult to predict the bottom, but if the recent lows hold again then sentiments may improve.

26.56-0.14(-0.52%)Aug 26 4:00 PMEDT