What follows is an excerpt from Canaccord Wealth Management’sMorning Coffee newsletter
Canaccord Genuity Precious Metals Analyst Steven Butler has reiterated his bullish rating on Silver Wheaton Corp. (TSX: T.SLW, Stock Forum), following the release of the company’s 2012 fourth quarter results, which came in ahead of Butler’s estimates.
In a press release, the company said fourth quarter highlights included record net earnings of $177.7 million ($0.50 per share), compared to $144.7 million ($0.41 per share) in Q4 2011, representing a 23% increase.
Fourth quarter adjusted EPS was 50 cents, versus Butler’s estimate of 44 cents. The variance was due to higher sales volumes, which also exceeded production, partly offset by higher depreciation and general and administration expenses.
The company has declared its first quarterly cash dividend payment for 2013 of US$0.14 per share; a doubling of the payment declared in the fourth quarter of US$0.07 per share. Looking ahead, including the recently acquired gold streams from Vale SA (NYSE: VALE, Stock Forum), the company forecasts 2013 attributable silver equivalent production of 33.5 million ounces (25.8 million ounces of silver and 145,000 ounces of gold).
Silver Wheaton remains Butler’s preferred senior silver producer based on its superior growth and net free cash flow profile, which provides capacity for additional accretive stream deals and an increasingly robust dividend policy.
Silver Wheaton shares rose 0.41% to $32.06 Monday, leaving the company with a market cap of $11.4 billion, based on 354.4 million shares outstanding. The 52-week range is $41.18 and $23.11.