Lumina Gold's Los Cangrejos Concession Extended to 2049

While this company’s portfolio is well-designed and keeps a diverse profile, the company can still take a hit when an important asset does not pan out. A case in point: Franco-Nevada has a strong stake in the Cobre Panama mine, in Panama – and last year that mine was shut down after the country’s president called for a mining moratorium. It is uncertain when it will resume production, and the ripple effects are still being felt.

In FNV’s last financial release, covering 3Q24, the $275.7 million in revenues were down almost 11% year-over-year although they came in $3.22 million better than anticipated; The 80-cent per share non-GAAP earnings figure was 3 cents per share lower than the estimates.

Looking at the bigger picture, UBS analyst Daniel Major is upbeat about the company’s prospects despite its challenges. He writes, “In our view the streaming/royalty business model remains compelling, despite higher headline valuation multiples… FNV’s growth is dependent on the restart of Cobre Panama and is therefore less certain; but in our view the stock is pricing in limited upside from a restart and any progression towards a potential restart will act as a positive catalyst. At 20x 2026E EV/EBITDA we estimate FNV is discounting ~ $2,250/oz gold.”

Quantifying his stance, Major rates FNV as a Buy, and his $160 price target points toward a 32% increase in the next 12 months. (To watch Major’s track record, click here)

The 10 recent analyst reviews on this stock are evenly split, 5 Buys and 5 Holds, to support a Moderate Buy consensus rating. The shares have a current trading price of $121.26 and an average target price of $151.61, together suggesting a 25% upside potential by this time next year. (See )

Wheaton Precious Metals (WPM)

Next up, Wheaton Precious Metals, is another Canadian company. Operating out of the western city of Vancouver, Wheaton is one of the world’s top precious metal streaming companies. Wheaton purchases the by-product metal output of its mining partners, agreeing on a set price in advance, and then sells those metals in the commodity markets. The result: Wheaton and its investors can tap into the productivity of the mining industry while avoiding the risks involved in mining activities.

Wheaton currently has partnerships with 18 operating mines, and is involved with another 28 projects under development. The company is guiding toward 40% production growth by 2028. Wheaton is prepared for the long term, as the operating mines it is involved with have a projected life-span of 28 years.

The company boasts that 93% of its assets are in the lower half of the cost curve, a feature that helps to maximize income. Wheaton has built up a solid reserve to maintain its operations, and as of September 30 this year had $694 million in cash and other liquid assets available.

Wheaton’s top- and bottom-line figures were up in 3Q24, the last period reported. Revenues came in at $308.25 million, up 38% y/y, while the non-GAAP EPS of 34 cents was up 32% from 3Q23. We should note that the revenue figure missed expectations by $4.36 million, but that the EPS was 1 cent better than had been expected.

For Major, this stock simply presents a strong opportunity for investors to play the gold market. He says, “In our view WPM has an attractive growth profile… Given the diversified nature of WPM’s existing portfolio and growth projects, we see limited risks to WPM’s 2028 GEO production target of 800koz. At 20x 2026 EV/EBITDA we estimate WPM is discounting ~$2,400/oz gold.”

The analyst goes on to put a Buy rating on WPM, along with a $78 price target that suggests an upside of 24.5% on the one-year time horizon.

Overall, Wheaton gets a Strong Buy consensus rating from the Street, based on 11 recent reviews that break down 9 to 2 favoring Buy over Hold. (See )

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.