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Based upon trailing 12 month operating cash flows (one standard way of valuing junior miners, WRM is worth $1.25 to $1.50 per share. IMHO, what is holding it down is; 1.) the continued uncertainty wrt the long term outlook for gold, 2.)Wheaton is currently a one property miner, 3.) that one property (the Golden Bear)is running out of ounces, 4.) the startup of Bellavista may result in Wheaton taking on a very significant debtload, 5.) Wheaton twice in the past rocketed up over $3.00, on encouraging drill results, only to crash and burn (investors/brokers have long memories). My hope is that Wheaton will eventually find a new discovery at the Golden Bear (it is, after all, a very large piece of land), and Management will astutely use their increasing cash reserves to bottom fish the market, to acquire undervalued assets from (say) a bankrupt company like Royal Oak, or acquire some ravaged junior miner with potential/proven ounces but no cash to continue operations. I remain long on Wheaton, at a price above Friday's 58 cent close, and I have been so for 5 years. Am I crazy? Will I be rewarded for my patience? Time will tell. Besides, it's only money. Regards. |
