Wheaton Precious Metals Corp (NYSE: WPM), or the erstwhile Silver Wheaton, is among the top three precious metal streaming companies, alongside Royal Gold (NASDAQ:RGLD) and Franco-Nevada (TSX:FNV). As a streaming company, Wheaton Precious doesn't own or operate mines but buys gold and silver streams from third-party miners at low costs in exchange for funding them up front.

Because of the lower costs and risks involved, the streaming business is more lucrative than traditional mining, which is why Wheaton Precious can generate hefty margins. Interestingly, though, the stock has hugely underperformed peers Royal Gold and Franco-Nevada in the past year or so, which tells me that investors probably do not know what an incredible hold Wheaton Precious Metals has in its industry, or the several ways it is superior to peers. Here are three things you probably didn't know about Wheaton Precious Metals but should.

Largest precious metals streaming company

Wheaton Precious Metals is the world's largest precious metals streaming company, and far ahead of Franco-Nevada and Royal Gold in terms of the size and scale of business. For perspective, Wheaton generated revenue of $892 million in fiscal 2016. By comparison, Franco-Nevada generated $610 million and Royal Gold only around $360 million in revenue last year.

A man holding a silver rock.

Image source: Getty Images.

Wheaton has a solid asset base with agreements with 21 operating and eight developing mines belonging to some of the largest miners in the industry. Its 2016 deal with Vale SA (NYSE:VALE), for instance, is already adding significant value to Wheaton, so much so that one could even attribute Wheaton's name change to the deal, as I explain next.

Best exposure to both gold and silver

For an investor in precious metals, Wheaton is perhaps one of the best stocks to gain near-equal exposure to gold and silver prices. That's because the company has expanded its gold portfolio aggressively in recent years, which is also why management dropped "Silver" from the company's former name, Silver Wheaton, and changed it to Wheaton Precious Metals to better reflect its portfolio mix.

In fact, Wheaton's silver production declined marginally in 2016, but higher gold production from Vale's Salobo mine pushed its volumes and sales to record highs. Salobo is a low-cost copper-gold mine and is the largest copper mine in Brazil. Last year, Wheaton extended its agreement with Vale to buy an additional 25% of the gold produced from Salobo over and above its existing 50% entitlement for the life of the mine. Simply put, Wheaton is entitled to 75% of the gold produced from Salobo.

Thanks to Salobo, Wheaton now expects gold to make up 45% of its average production (or the metal streams it buys from miners) through 2021. None of the other streaming companies offer investors such a balanced exposure to gold and silver.

Lowest-cost streaming company

Partly because of its size and partly because of a solid mix of streaming agreements with leading miners such as Barrick Gold and Goldcorp, Wheaton is the lowest-cost streaming company and enjoys the strongest margins in the industry.

WPM Operating Margin (TTM) Chart

WPM Operating Margin (TTM) data by YCharts.

You can also see how Wheaton's margins haven't been as volatile as Royal Gold's and Franco-Nevada's over the years. Again, I'd attribute that to Wheaton's better-balanced product mix, as well as its low costs. Wheaton's operating cost -- which is simply the price at which the company buys metal streams from miners -- has historically averaged only $400 an ounce for gold and $4 per ounce of silver. That means that even if gold and silver prices were to be cut in half from current levels, Wheaton should still be able to generate positive operating margins. For shareholders, Wheaton's low costs translate into strong cash flows and dividends.

Foolish takeaway

Like any other stock, Wheaton Precious Metals has its fair share of challenges. But now that you know the company better, there's no denying that it's the leader in the precious metals streaming space. Trading at less than 15 times cash flow, Wheaton Precious Metals is also the cheapest stock among peers and could offer good value to long-term shareholders at current prices.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.