Silver Wheaton Corp. (USA) (SLW), Barrick Gold Corporation (USA) (ABX): 2 Precious Metal Stocks That Could Drive Your Portfolio Higher

Page 1 of 2

Investors may want to consider making new friends with a couple of companies in the Basic Materials sector who have some history of rewarding shareholders. Of course, like making friends in your personal life, doing so as part of an investing strategy requires the same trust element.

The following are two precious metals companies to consider. One is silver and the other is gold. One is Silver Wheaton Corp. (USA) (NYSE:SLW) and the other is Barrick Gold Corporation (USA) (NYSE:ABX). Careful research of their respective operations and financials may make them welcome additions to your stock portfolio, depending on your risk profile.

5 Reasons to consider Silver Wheaton

1. A strong portfolio

Silver Wheaton Corp. (USA) (NYSE:SLW) has several agreements, where they have the right to buy all, or a part of the silver and/or gold production from 19 operating mines and four development stage projects. Their asset portfolio includes silver and precious metal streams on Barrick Gold’s Pascua-Lama project. It also includes streams on Hudbay Minerals’ 777 mine and Constancia project, and Vale S.A.’s Salobo and Sudbury mine.

2. Growth in attributable proven and probable reserves

Silver Wheaton recently reported that attributable proven and probable reserves increased more than 38% in 2012. They grew to a record 1,116.1 million silver equivalent ounces. This consists of 851.4 million ounces of silver and 4.96 million ounces of gold.

Therefore, for proven and probable reserves, the company has major growth in that portion of their Measured and/or Indicated mineral resource that is the economically mine-able portion.

3. They have no exploration costs

As a precious metals streaming company, Silver Wheaton offers upfront money, which they provide to a mining enterprise seeking capital. They can enjoy the benefits of exploration without having to take part in the exploration. They don’t have to invest additional resources (such as manpower, and more) and assume the risk inherent in that exploration.

4. Their Focus is buying at a low fixed cost

Their agreements with other companies pertains to them buying a percentage of a mine’s production at a price that’s lower than the spot price (stated outright value at any given time on the market) for the particular precious metal. Therefore, Silver Wheaton’s gain is the spread between their fixed payment and the spot price.

5. Strong forecasted production

Silver Wheaton Corp. (USA) (NYSE:SLW)’s 2013 attributable production forecast is approximately 33.5 million silver equivalent ounces. The company anticipates annual attributable production to grow to approximately 53 million silver equivalent ounces by 2017.

Production growth is a path to better shareholder returns and something for investors to look at. However, this production growth must be in tandem with cost containment and better production efficiency. A drop in commodity prices, without an accompanying drop in costs, can put the hurt on companies and their shareholders.

5 Reasons to consider Barrick Gold

1. Flush with cash

Barrick Gold Corporation (USA) (NYSE:ABX)’s full year 2012 operating cash flow was a record $5.44 billion. Mr. Jamie Sokalsky, Barrick Gold CEO, said recently, “The first step towards increasing returns to shareholders is to have the underlying business running well. For 2012, we delivered record annual operating cash flow, and the second-highest adjusted earnings per share in Barrick’s history.”

2. Nuggets in Nevada

In their own words, ” Nevada is a core operating region for Barrick and is the cornerstone of our success.” At their Goldrush deposit in the state, the company has a measured and indicated resource of 8.4 million ounces ( as of Dec. 31, 2012). This is a 500% increase from the prior year. Now, everything’s not high-gloss for Barrick; they reported a net loss of $0.67 billion for full year 2012. However, there’s potential for growth and improved results with operations such as Goldrush contributing to their gold pot.

3. They’re getting to the core of the issue

Barrick Gold Corporation (USA) (NYSE:ABX) is refocusing on what they do best – mining for gold. Consequently, the company recently reported that they are ” Pursuing and actively engaged in realizing opportunities to rationalize our portfolio, including the sale of Barrick Energy and other non-core assets with short mine lives and high operating costs.” ( reported Feb. 14, 2013).

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 10 Countries with the Highest Suicide Rates

The 10 Most Technologically Advanced Countries in the World

The 10 Safest Countries in the World to Live in Peace

The 10 Top Selling Smartphones in the World 2014

The 12 Biggest Shopping Centers in the World

The 10 Friendliest Countries in the World

Qihoo 360 Technology Co Ltd (QIHU), Actavis plc (ACT), Yahoo! Inc. (YHOO) Among 20 Long Ideas from Sohn Canada

The 10 Laziest Countries in the World

The 10 Most Polluted Countries in the World

The 10 Most Dangerous Cities in America 2014

The Top 10 Gold Producing Countries in the World

The 10 Tallest Buildings in the World

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!