Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Investing in the METAVERSE Stocks Universe - 8th Dec 21
Stock Market Sentiment Speaks: I Expect 15-20% Returns For 2022 - 8th Dec 21
US Dollar Still Has the Green Light - 8th Dec 21
Stock Market Topping Process Roadmap - 8th Dec 21
The Lithium Breakthrough That Could Transform The Mining Industry - 8th Dec 21
VR and Gaming Becomes the Metaverse - 7th Dec 21
How to Read Your Smart Meter - Economy 7, Day and Night Rate Readings SMETS2 EDF - 7th Dec 21
For Profit or for Loss: 4 Tips for Selling ASX Shares - 7th Dec 21
INTEL Bargain Teck Stocks Trading at 15.5% Discount Sale - 7th Dec 21
US Bonds Yield Curve is not currently an inflationist’s friend - 7th Dec 21
Omicron COVID Variant-Possible Strong Stock Market INDU & TRAN Rally - 7th Dec 21
The New Tech That Could Take Tesla To $2 Trillion - 7th Dec 21
S&P 500 – Is a 5% Correction Enough? - 6th Dec 21
Global Stock Markets It’s Do-Or-Die Time - 6th Dec 21
Hawks Triumph, Doves Lose, Gold Bulls Cry! - 6th Dec 21
How Stock Investors Can Cash in on President Biden’s new Climate Plan - 6th Dec 21
The Lithium Tech That Could Send The EV Boom Into Overdrive - 6th Dec 21
How Stagflation Effects Stocks - 5th Dec 21
Bitcoin FLASH CRASH! Cryptos Blood Bath as Exchanges Run Stops, An Early Christmas Present for Some? - 5th Dec 21
TESCO Pre Omicron Panic Christmas Decorations Festive Shop 2021 - 5th Dec 21
Dow Stock Market Trend Forecast Into Mid 2022 - 4th Dec 21
INVESTING LESSON - Give your Portfolio Some Breathing Space - 4th Dec 21
Don’t Get Yourself Into a Bull Trap With Gold - 4th Dec 21
4 Tips To Help You Take Better Care Of Your Personal Finances- 4th Dec 21
What Is A Golden Cross Pattern In Trading? - 4th Dec 21
Bitcoin Price TRIGGER for Accumulating Into Alt Coins for 2022 Price Explosion - Part 2 - 3rd Dec 21
Stock Market Major Turning Point Taking Place - 3rd Dec 21
The Masters of the Universe and Gold - 3rd Dec 21
This simple Stock Market mindset shift could help you make millions - 3rd Dec 21
Will the Glasgow Summit (COP26) Affect Energy Prices? - 3rd Dec 21
Peloton 35% CRASH a Lesson of What Happens When One Over Pays for a Loss Making Growth Stock - 1st Dec 21
Stock Market Sentiment Speaks: I Fear For Retirees For The Next 20 Years - 1st Dec 21 t
Will the Anointed Finanical Experts Get It Wrong Again? - 1st Dec 21
Main Differences Between the UK and Canadian Gaming Markets - 1st Dec 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Silver Wheaton, The $100.00 Stock 

Companies / Gold & Silver Stocks Nov 06, 2010 - 08:28 AM GMT

By: Bob_Kirtley


Having sold a number of stocks in order to acquire more of Silver Wheaton Corporation (SLW) stock on 09 August 2010 we are pleased to see that our new strategy is paying off handsomely. A quick look at the above chart shows that since making that particular purchase, we have in first place SLW followed by silver, gold, the miners and the much fancied juniors, all of which are not able to keep up with SLW. The progress has been remarkable up to the closing last week at $32.95 for gain of 65% in the price of this stock.

The question is just where do we go from here. As we see it silver prices have finally taken off and they too had an excellent week closing at $26.72/oz. The silver market is tiny when compared to the gold market and the gold market is tiny when compared to the stock market in general. As silver becomes more popular and gets a little of the limelight that gold is currently basking in we will see an ever growing demand by investors who are savvy enough to spot this once in a life time opportunity. As they re-allocate a tiny portion of their funds to silver they will learn that there is very little silver to go around and that silver prices will be constantly moving away from them. The buying pressure will shortly push silver prices up and through the $30.00/oz level causing the industrial users to make purchases almost regardless of price, otherwise their business activity grinds to a halt. And so a dual between the investment community and the industrial sector will gather speed taking silver prices from its short term high of $30/oz to around $60.00/oz. This is only our view and many will chuckle at such predictions, however, thats our stance.

For the producers of silver this move north will generate enormous profits and their stock prices will also feel a tail wind that most investors have never witnessed before in this sector as they just are not old enough to have been around the last time it happened. The producers will have to wrestle with a number of variables such as rising energy, labour, transportation and environmental costs, not to mention the geo-political changes that lay in wait for them.

Silver Wheaton is more or less immune to such vagaries as the contracts are now in place that provide them with staggering amounts of silver at a fixed price of around $4.04/oz. As the miners ramp up production and further contracts are secured, the profits will be mind boggling. The success of this business model has already been clearly demonstrated and as the company profile attracts more coverage the stage is set for the next phase which we will call the turbo charged phase.

For our prediction of $100.00 per share to materialize we need to see gains in the order of threefold from the current stock price and we are comfortable with it.

Near term, look for the next set of results from the Silver Wheaton Corporation which is due to release its third-quarter figures after the market close on Monday, 08 November, 2010. Our expectation is for earnings to be in the order of $0.20 per share on revenue of $110 million. A year ago the company reported earnings of $0.11 cents per share on revenue of $70 million.

Silver Wheaton Corporation trades on the New York Stock Exchange and the Toronto Stock Exchange under the symbol of SLW.

The Company has a market capitalization of $11.33 billion, with 344.00 million shares outstanding, a 52 week trading range of $13.04 to $33.66 with an average volume of 7-12 million shares traded, although spikes in trading have seen 14 million shares change hands.

Now, both gold and silver traded a lot lower just prior to the spike last week and looked a tad gloomy as investors were nervous about the possible outcome of the elections and QE2. However, our options team remained focused and issued a buy signal stating which options contract to buy, the series, the strike price and how much to pay for them. These contracts, which were barely a day old traded 91% higher than when we fired out that buy signal, a nice start for our newly formulated strategy after banking recent profits and returning to a total cash position.

If you have got something better then please tell us about it, if not, then please give some consideration to joining our winning

To stay updated on our market commentary, which gold stocks we are buying and why, please subscribe to The Gold Prices Newsletter, completely FREE of charge. Simply click here and enter your email address. (Winners of the GoldDrivers Stock Picking Competition 2007)

For those readers who are also interested in the silver bull market that is currently unfolding, you may want to subscribe to our Free Silver Prices Newsletter.

DISCLAIMER : Gold Prices makes no guarantee or warranty on the accuracy or completeness of the data provided on this site. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This website represents our views and nothing more than that. Always consult your registered advisor to assist you with your investments. We accept no liability for any loss arising from the use of the data contained on this website. We may or may not hold a position in these securities at any given time and reserve the right to buy and sell as we think fit.
Bob Kirtley Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in