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Silver Wheaton Corp.

Silver Wheaton Corp. is the largest precious metals streaming company in the world. Based upon its current agreements, forecasted annual attributable production for 2014 is approximately 36 Moz Ag eq, including 155 Koz gold. By 2018, annual attributable production is anticipated to increase significantly to approximately 48 Moz Ag eq, including 250 Koz gold. This growth is driven by the company's portfolio of low-cost and long-life assets, including precious metal and gold streams on Hudbay Minerals Inc.'s Constancia project and Vale S.A.'s Salobo and Sudbury mines.

Expert Comments:

Phil Russo, Raymond James (3/23/15)
"We are resuming coverage of Silver Wheaton Corp. with an Outperform rating and $30.00 target price post the closing of its $900M gold stream deal with Vale S.A. and its parallel $800M equity deal. We view the stream positively with the outlook for the company strengthened given its cash flows, while still underpinned by precious metals, now having a greater weighting toward gold. We believe this changing gold exposure will benefit the stock over time. . .we expect ongoing stability from its key streaming contributors in 2015. Beyond 2015, Silver Wheaton's profile continues to look attractive."

"Royalty companies can be a great way to play it safe. They put up the money and receive a royalty off the top or a guaranteed stream above a fixed cost of future production. This simple royalty business model has none of the risk and juicy, fat margins. Silver Wheaton Corp. has one of the best records in the business when it comes to most revenue per employee and most cash flow per employee. Where can you have less than 30 people with cash flow of $500M a year?" read more >

Canaccord Genuity's Morning Coffee (3/20/15)
"Silver Wheaton Corp. maintains its majority silver exposure with an estimated 39–43% gold contribution over the next five years (up from 27% in 2014). . .the company remains a preferred avenue to silver exposure due to the strong margin base and participation in reserve growth and production expansion at no further cost."

Andrew Quail, Goldman Sachs (3/19/15)
"Fueled by commercial production at Constancia (Q2/15), higher streaming interest at Salobo (50%), increased contribution from San Dimas and Barrick (grades), we anticipate Silver Wheaton Corp.'s production to grow 23% to 43.6 Moz silver-equivalent in FY15. We anticipate a further increase in production by FY19 driven by expansion. . .at San Dimas and higher contribution at Penasquito and Constancia. High-quality assets Rosemont and Pascua Lama provide additional growth upside if and when they commence operations. . .given the company's low-cost business model. . .we anticipate strong earnings before interest, tax, depreciation and amortization deductions margins of 70%, resulting in significant free cash flow generation of $1.7B over FY15–FY19."

Cosmos Chiu, CIBC World Markets (3/19/15)
"Silver Wheaton Corp. reported Q4/14 earnings of $0.14 per share, largely in-line with our estimate of $0.15 per share, with attributable silver-equivalent production of 9.0 Moz (sales of 8.5 Moz). . .attributable production growth in 2015 will have somewhat of a gold bias, in large part driven by expanding production and incremental 25% gold stream acquired at Salobo. . .while the company remains silver focused, its management has observed more attractive opportunities in the gold space. . .with cash on hand, operating cash flow, and available credit under its revolving facility, Silver Wheaton continues to be positioned for further acquisitions."

Trevor Turnbull, Scotia Capital (3/19/15)
"We are incorporating Silver Wheaton Corp.'s $900M purchase of an additional 25% of the Salobo mine's gold production and the subsequent $800M equity financing. The company now receives 50% of all gold produced from Vale's world-class copper mine (nearly 50-year reserve life and first-quartile cash costs inclusive of the gold stream). . .Silver Wheaton continues to trade well below its peers, and we firmly reiterate our Sector Outperform rating."

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