Weakening Gold Price Effect: Wheaton Precious Metals Stock Drops 7% In A Week

by Trefis Team
+38.02%
Upside
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Trefis
WPM
Wheaton Precious Metals
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Wheaton Precious Metals stock (NYSE: WPM) dropped 7% in the last one week (five trading days) and has, in fact, underperformed the broader market as the S&P 500 remained almost flat during this period. WPM stock currently trades at $37 per share. The drop in stock price was driven by continued weakness in global gold prices. After registering an impressive rise from $1,500/ounce in January 2020 to over $2,000/ounce in September 2020, gold prices have since then remained volatile and have, in fact, largely declined. In the last one week, gold price per ounce has gone down almost 4% from a little over $1,805 to $1,735. Weakness in the gold price was driven by the gradual lifting of lockdowns and successful vaccine rollout, which led to expectations of faster economic recovery. The recent rise in bond yields and expectations of a rise in interest rates in the near future has taken some sheen off the yellow metal as an attractive investment option, thus taking a toll on gold prices. But, is WPM stock set to continue its upward trajectory or could we expect some correction? We believe that there is a 63% chance of a rise in WPM stock over the next month (twenty-one trading days) based on our machine learning analysis of trends in the stock price over the last five years. See our analysis on WPM Stock Chances Of Rise for more details.

Five Days: WPM -7%, vs. S&P500 0.06%; Underperformed market

(7% likelihood event)

  • Wheaton Precious Metals Corp stock declined 7.0% over a five-day trading period ending 3/2/2021, compared to the broader market (S&P500) rise of 0.06%
  • A change of -7% or more over five trading days is a 7% likelihood event, which has occurred 94 times out of 1256 in the last five years

Ten Days: WPM -5.8%, vs. S&P500 -1.2%; Underperformed market

(12% likelihood event)

  • Wheaton Precious Metals Corp stock declined 5.8% over the last ten trading days (2 weeks), compared to broader market (S&P500) decline of 1.2%
  • A change of -5.8% or more over ten trading days is a 12% likelihood event, which has occurred 160 times out of 1240 in the last five years

Twenty-One Days: WPM -10%, vs. S&P500 4.6%; Underperformed market

(29% likelihood event)

  • Wheaton Precious Metals Corp stock declined 10% the last 21 trading days (1 month), compared to a broader market (S&P500) rise of 4.6%
  • A change of -10% or more over 21 trading days is a 29% likelihood event, which has occurred 348 times out of 1198 in the last five years

While WPM stock may have moved, 2020 has created many pricing discontinuities which can offer attractive trading opportunities. For example, you’ll be surprised how how the stock valuation for Compass Minerals vs Southwest Gas shows a disconnect with their relative operational growth. You can find many such discontinuous pairs here.

 

See all Trefis Price Estimates and Download Trefis Data here

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