As 2013 begins, now's a good time to look at the future prospects for the stocks you own. If you don't know where a company's headed in the next year and beyond, then it's impossible to make an informed decision about whether you should add the stock to your portfolio -- or sell it if you already own it.
Today, I'll look at Silver Wheaton (SLW 4.02%). The silver streaming giant had a strong 2012 as it managed to make a big new streaming deal and took advantage of weakness among miners to secure its own leadership position within its niche. But will the good times last? Below, you'll learn more about Silver Wheaton's prospects for 2013.
Stats on Silver Wheaton
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|---|---|
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Average Stock Target Price |
$47.32 |
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Full-Year 2012 EPS Estimate |
$1.65 |
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Full-Year 2013 EPS Estimate |
$2.21 |
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Full-Year 2012 Sales Growth Estimate |
11.4% |
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Full-Year 2013 Sales Growth Estimate |
26.9% |
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Forward P/E |
16.4 |
Source: Yahoo Finance.
Will Silver Wheaton keeping raking in the profits in 2013?
Analysts have high expectations for Silver Wheaton. Their target price for the shares is more than 30% higher than where the stock trades currently, and earnings and revenue growth are projected to accelerate in 2013.
Despite its unique business model, Silver Wheaton's fortunes are still strongly tied to the price of silver. An expected renewal of global economic growth, with the silver-hungry tech sector seen having particularly stronger levels of activity, should boost silver prices. Moreover, unlike bullion investments iShares Silver (SLV 4.98%) and Central Fund of Canada (CEF 3.07%), Silver Wheaton has effective leverage to silver prices, meaning that the stock stands to gain more from rising silver prices in percentage terms than bullion itself.
Particularly interesting looking forward are Silver Wheaton's investment holdings. Not only are silver streams from Goldcorp (GG +0.00%) and Barrick Gold (ABX 4.83%) expected to yield more metal, but the company's 7.8% stake in Sabina Gold & Silver, which Fool gold expert Christopher Barker picked as his top gold stock for 2013, could also pay off big for Silver Wheaton.
Silver Wheaton still has plenty of potential, as silver prices are well off their highs from a couple years ago. If silver renews its bull run, then Silver Wheaton shareholders will do quite well.
Click here to add Silver Wheaton to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.
