Will Silver Wheaton’s Rally Last?

Silver Wheaton Corp. (SLW) has been doing well in the stock market in the past several weeks: Shares of Silver Wheaton spiked by 37.6% since the beginning of July (up-to-date). This recent rally was partly driven by the recovery in the silver market: The price of silver jumped by 17%. Will Silver Wheaton’s latest run continue? Or will it reach a halt? Let’s analyze the latest developments related to Silver Wheaton.

Second quarter results

During the second quarter of 2013, the company’s revenues fell by 17% compared to the second quarter in 2012. Moreover, the company’s operating profit tumbled down by 49.5% to its lowest level in years.

Let’s break-down Silver Wheaton’s earnings results between its two main precious metals: Silver and gold.

Silver Sales

During the second quarter, the amount of silver sold fell by over 24% (year-over-year).

But this wasn’t the only factor that adversely affected the company’s revenues. The price of silver also decline by over 20%. These two factors contributed to the nearly 40% plunge in silver revenues.

Looking forward for the third quarter, if we assume the company will reach its annual goals in terms of silver produced, and if we assume the current average price for the third quarter won’t change, then the company’s revenues from silver will fall again by nearly 21% (year-over-year). 

For the rest of the analysis see in Seeking Alpha 


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Disclaimer: The author holds no positions in stocks mentioned and does not plan to initiate positions within 120 hours of the posting of this article. This article is to be used for educational, research and informational purposes only and does not constitute investment advice. There are no guarantees, expressed or implied, of future positive returns in regards to the subject matter contained herein. Understand the risks inherent in investing before making the decision to invest or consult an investment professional for more information. Reasonable due diligence has been performed in regards to the information in this article. However, the author expressly disclaims any liability for accidental omissions of information or errors in fact.