Copper and gold miner Freeport-McMoRan Inc. (NYSE:FCX) can't seem to catch a break lately, with the shares down roughly 30% from their early 2017 highs. Gold and silver streaming company Wheaton Precious Metals Corp. (NYSE:WPM), meanwhile, is down around 15% from its early year highs. That's not great, either. However, the difference here underlines a key reason why you'll prefer Wheaton Precious Metals over Freeport if you're looking at the mining space.

Another big hit

Freeport-McMoRan was its own worst enemy during the commodity downturn. The problem wasn't copper or gold, however -- it was an ill-timed investment in oil. In 2013, Freeport bought McMoRan Exploration Co. and Plains Exploration, pushing the company's long-term debt from a reasonable $3.5 billion to $20 billion in just one year. When oil prices started to fall in mid-2014, that investment and the debt it entailed became an albatross.  

A miner holding a nugget of silver.

Image source: Getty Images.

Freeport has just started to get beyond that issue, selling assets to pay down debt. Notably, it jettisoned almost all of its troublesome oil business. The big number, however, remained on the balance sheet. At the end of the first quarter last year, net debt at Freeport was a little over $20 billion. It ended Q1 2017 with net debt of around $11 billion. So progress has been made, and it should have been much smoother sailing in 2017.    

But in February the company ran into problems with the Indonesian government around Freeport's Grasberg mine. This mine accounts for roughly 30% of Freeport's copper reserves and about 95% of its gold reserves, so it's a very important asset. The issue is complex, but it boils down to Indonesia wanting to get paid more for letting Freeport run the mine. The two sides are working on a resolution, but progress has been slow. That said, it's little wonder that most of Freeport's 30% stock decline came after it announced the Grasberg issue. It doesn't help that copper prices are lower since that point, too, but it's worth noting that copper peer Southern Copper is only down around 11% over the same span.    

WPM Chart

WPM data by YCharts.

At the end of the day, despite hard work to get itself back on track, Freeport's business is still in flux. That will remain the case until there's a full resolution at Grasberg.

Same old boring Wheaton

Which is why you might prefer Wheaton Precious Metals, formerly known as Silver Wheaton. Other than a recent name change, Wheaton is playing out the same game plan it always has. Wheaton is what's known as a streaming company, meaning it provides miners upfront cash payments for the right to buy silver and gold at reduced prices in the future. It pays roughly $4 an ounce for silver and $400 an ounce for gold, far less than the current spot price for either metal.    

Slide explaining Wheaton's business model

Wheaton's streaming model. Image Source: Wheaton Precious Metals. 

It's a fairly stable business. For example, revenue was up 6% year over year in the first quarter despite a strike at one of the silver mines with which Wheaton has a streaming deal. That strike, since resolved, pushed silver production lower year over year by 14%. However, that was more than offset by a 37% increase in gold production based partially off of streaming deals inked during the commodity downturn.  

In fact, Wheaton is unique in that commodity downturns are actually really great times for expansion. The bad years are when miners are most in need of the cash streaming companies offer. Although that doesn't change the impact that low silver and gold prices will have on the company's top and bottom lines, it means that Wheaton can come out of downturns in a stronger business position because of opportunistic investments.

Still, Wheaton faces its own risks. For example, the Canadian government believes the company is calculating its taxes incorrectly. If Wheaton loses this tax dispute, it could face a big one-time tax bill and an ongoing reduction in the company's profitability due to higher taxes. But that won't change Silver Wheaton's basic business model, which has proven itself over time.    

An avoidable risk 

Despite its efforts, the trials and tribulations at Freeport continue. Although it's likely that a resolution will be reached with Indonesia, the company has a lot riding on a positive outcome. The uncertainty has pushed shares far lower than peers like Southern Copper, which suggests notable upside potential -- but only if you want to take on the risk that things don't work out equitably.

This is why most investors would be better off with Wheaton. It has the tax dispute hanging over it, but its business model has proven incredibly resilient. Add in the fact that Wheaton can benefit while other miners are struggling, and it should look even more appealing to long-term investors.