Silver Wheaton (SLW) Stock Rises as Silver Prices Climb

NEW YORK (TheStreet) -- Shares of Silver Wheaton  (SLW) rose 5.18% to $18.89 in afternoon trading Tuesday due to a rise in silver prices.

The silver miner received a boost from the price of silver futures, which rose 1.08% to $15.84 an ounce, according to CNBC.

Silver Wheaton reports third-quarter earnings Wednesday before the market open. The consensus estimate calls for earnings of 21 cents a share on revenue of $177.28 million.

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Silver prices plunged 2.3% last week, even after including a gain of 30 cents on Friday, and continued to dip on Monday.

More than 5.1 million shares had changed hands as of 2:48 p.m. to barely edge the average volume of 5,033,910.

Separately, TheStreet Ratings team rates SILVER WHEATON CORP as a "hold" with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate SILVER WHEATON CORP (SLW) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • SLW's debt-to-equity ratio is very low at 0.29 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 7.39, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for SILVER WHEATON CORP is currently very high, coming in at 76.19%. Regardless of SLW's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SLW's net profit margin of 42.73% significantly outperformed against the industry.
  • SLW, with its decline in revenue, underperformed when compared the industry average of 0.8%. Since the same quarter one year prior, revenues fell by 11.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • SILVER WHEATON CORP's earnings per share declined by 10.0% in the most recent quarter compared to the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, SILVER WHEATON CORP reported lower earnings of $1.05 versus $1.65 in the prior year. For the next year, the market is expecting a contraction of 21.4% in earnings ($0.83 versus $1.05).
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Metals & Mining industry average. The net income has decreased by 10.7% when compared to the same quarter one year ago, dropping from $71.12 million to $63.49 million.
  • You can view the full analysis from the report here: SLW Ratings Report

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