The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
NEW YORK ( Trefis) -- Silver Wheaton (SLW - Get Report) is the world's largest silver streaming company and competes with silver manufacturers like Silver Standard Resources (SSRI), Pan American Silver (PAAS), Bear Creek Mining (BCM) and Endeavor Silver (EXK).
It purchases silver from mining companies that produce silver as a by-product, typically gold and copper mining companies. The company currently has fourteen silver purchase agreements and two purchase agreements for precious metals like gold.
Moreover, the company also has the right to purchase all or a portion of the silver production attributable. This gives it an edge over the conventional mining companies as it does not incur any kind of operational losses in volatile market conditions. Moreover, since the company does not own any of the mines, it does not incur any operational and capital costs associated with the production.We recently launched coverage of Silver Wheaton with a $50 Trefis price estimate for the company's stock. Based upon the company's silver purchase agreements, we have broken down our analysis of Silver Wheaton into seven business segments: Primero, Barrick Gold, Goldcorp, Capstone, Glencore, Lundin, and Other.