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Wondering whether Wheaton Precious Metals at around US$161.89 still offers value, or if most of the easy gains are already behind it? This article walks through what the current price actually implies.
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The stock has pulled back recently, with the share price down 12.7% over the past week and 11.7% over the past month, even though the 1 year return sits at 34.1% and the 5 year return is 193.8%.
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Recent attention on precious metals stocks, ongoing discussion around interest rates, and shifting investor sentiment toward safe haven assets have all fed into these price moves. Against that backdrop, Wheaton Precious Metals is back on many watchlists as investors reassess what a reasonable price looks like.
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Simply Wall St currently gives Wheaton Precious Metals a value score of 1 out of 6. Next up is a closer look at what different valuation approaches say about the stock today and a way to build an even clearer view of value by the end of the article.
Wheaton Precious Metals scores just 1/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.
Approach 1: Wheaton Precious Metals Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow, or DCF, model takes estimates of a company’s future cash flows and discounts them back to today, aiming to translate those future dollars into a single present value per share.
For Wheaton Precious Metals, the model uses last twelve months Free Cash Flow of about $909.6 million as a starting point and then applies a 2 Stage Free Cash Flow to Equity approach. Analysts provide specific forecasts for the next few years, and Simply Wall St extends those estimates further out. By 2029, projected Free Cash Flow is $2.93 billion, with additional extrapolated projections running through 2035.
Aggregating and discounting these projected cash flows results in an estimated intrinsic value of about $160.49 per share. With the current share price around US$161.89, the DCF output suggests the stock is about 0.9% above this estimate, so the model points to a valuation that is very close to the present market price.
Result: ABOUT RIGHT
Wheaton Precious Metals is fairly valued according to our Discounted Cash Flow (DCF), but this can change at a moment’s notice. Track the value in your watchlist or portfolio and be alerted on when to act.
