Financial Comparison: Silver Wheaton Corp (NYSE:WPM) & Tahoe Resources (TAHO)

Tahoe Resources (NYSE: TAHO) and Silver Wheaton Corp (NYSE:WPM) are both basic materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, earnings, dividends, profitability, risk, valuation and analyst recommendations.

Dividends

Silver Wheaton Corp pays an annual dividend of $0.28 per share and has a dividend yield of 1.5%. Tahoe Resources does not pay a dividend. Silver Wheaton Corp pays out 56.0% of its earnings in the form of a dividend.

Profitability

This table compares Tahoe Resources and Silver Wheaton Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tahoe Resources 19.39% 7.39% 6.26%
Silver Wheaton Corp 25.05% 5.90% 4.78%

Valuation & Earnings

This table compares Tahoe Resources and Silver Wheaton Corp’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Tahoe Resources $884.74 million 1.95 $433.59 million $0.55 10.05
Silver Wheaton Corp $902.00 million 9.26 $617.05 million $0.50 37.80

Silver Wheaton Corp has higher revenue and earnings than Tahoe Resources. Tahoe Resources is trading at a lower price-to-earnings ratio than Silver Wheaton Corp, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

65.0% of Tahoe Resources shares are held by institutional investors. Comparatively, 50.5% of Silver Wheaton Corp shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations for Tahoe Resources and Silver Wheaton Corp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tahoe Resources 0 7 1 0 2.13
Silver Wheaton Corp 0 1 2 0 2.67

Tahoe Resources presently has a consensus price target of $17.33, suggesting a potential upside of 213.44%. Silver Wheaton Corp has a consensus price target of $27.67, suggesting a potential upside of 46.38%. Given Tahoe Resources’ higher possible upside, equities research analysts plainly believe Tahoe Resources is more favorable than Silver Wheaton Corp.

Volatility and Risk

Tahoe Resources has a beta of 0.47, indicating that its share price is 53% less volatile than the S&P 500. Comparatively, Silver Wheaton Corp has a beta of 0.4, indicating that its share price is 60% less volatile than the S&P 500.

Summary

Silver Wheaton Corp beats Tahoe Resources on 8 of the 15 factors compared between the two stocks.

Tahoe Resources Company Profile

Tahoe Resources Inc. is a mine operations, and mineral exploration and development company. The Company’s principal business activities are the exploration, development, operation and acquisition of mineral properties for the mining of precious metals in the Americas. Its business involves operating the Escobal mine, a silver mining operation located in southeastern Guatemala, the La Arena and Shahuindo mines, gold mining operations located in northwestern Peru, and the Bell Creek mine and mill and the Timmins West mine, gold mining operations located in northeastern Ontario, Canada. Its additional business objectives include the expansion of gold production at the Shahuindo and Bell Creek mines, the development of the Whitney Project and the ongoing exploration programs in Peru and Canada. It focuses on the initial evaluation of exploration/development projects with the main projects being the La Arena copper-gold sulfide project in Peru and the Fenn-Gib gold project in Canada.

Silver Wheaton Corp Company Profile

Wheaton Precious Metals Corp, formerly Silver Wheaton Corp, is a Canada-based pure precious metals streaming company engaged in the sale of silver and gold. The Company operates through eight segments: the silver produced by the San Dimas, Penasquito and Antamina mines, the gold produced by the Sudbury and Salobo mines, the silver and gold produced by the Constancia mine and the Other mines, and corporate operations. The Company has entered into long-term purchase agreements and early deposit long-term purchase agreement associated with silver and gold (precious metal purchase agreements), relating to mining assets, whereby Silver Wheaton acquires silver and gold production at various mines. The San Dimas gold-silver deposit is located in the San Dimas district on the border of Durango and Sinaloa states. The Company holds interest in Los Filos mine, Zinkgruvan mining operations, Stratoni mine, Keno Hill silver, Cozamin mine, Aljustrel mine, 777 mine and Constancia mines.

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