How Does Silver Wheaton Compare With Other Streaming Companies In Terms Of Profitability?

SLW: Wheaton Precious Metals logo
SLW
Wheaton Precious Metals

Silver Wheaton is the largest player in the precious metal streaming space, in terms of revenue. The company is also the most profitable among the major streaming companies, as illustrated by the following table. Whereas Silver Wheaton’s rivals have superior EBITDA margins, the company enjoys the highest net margins.

SLW Comparison With Other Streaming Companies

The major reason for this situation is the favorable tax treatment that Silver Wheaton’s operations are subject to. With the bulk of the company’s profits sourced from subsidiaries located in jurisdictions that are subject to near zero income tax rates, Silver Wheaton’s tax expense is considerably lower as compared to its competitors. Check out our forecasts for Silver Wheaton’s income tax expense.

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Silver Wheaton’s income tax expense is currently the subject of scrutiny by the Canada Revenue Agency (CRA), with the regulatory authority auditing several of the company’s transactions. [1] A favorable final ruling by the CRA, which preserves the status quo in terms of the tax treatment of the company’s operations, is desirable from Silver Wheaton’s perspective in order to maintain its competitive advantage.

Have more questions about Silver Wheaton? See the links below.

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Silver Wheaton

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Notes:
  1. Silver Wheaton provides update on CRA dispute, Silver Wheaton News Release []