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Actionable news in SLW: SILVER WHEATON CORP,

Silver Wheaton: Ignore The Noise, Buy The Opportunity


There has been a lot of negative chatter around SLW lately due to the CRA tax dispute, but this is old news and has already been priced into the stock.

Investors should instead focus on the positives about SLW since it is increasing its percentage of gold production at a time when the market is encouraging.

SLW’s gold production will go up to 43% of the overall portfolio from 37% as it looks to tap the bull cycle in the gold market.

Gold demand will continue to rise due to soft economic growth globally that has forced the Fed to reduce the number of rate hikes, leading to stronger pricing.

There is no stopping Silver Wheaton (NYSE:SLW) this year as shares of the gold and silver mining company have already shot up more than 40% this year. However, of late, there have been concerns from certain quarters that have been focusing on the ongoing tax audit by the Canada Revenue Agency (NASDAQ:CRA), which has proposed to tax the income earned by the company offshore for the years 2005 to 2013. But, this is old news and investors should not panic about the CRA reassessment. Let's see why.

The negatives are already priced in

The news of the CRA proposal to tax Silver Wheaton's offshore income for the 2005-2010 period came out in July last year, with the agency seeking back taxes of around $567 million. Then, Silver Wheaton filed an appeal on January 8 of this year in the Tax Court of Canada. Once this appeal was filed, the CRA decided that it will also reassess the 2011 to 2013 tax years in a manner that represents that the agency is trying to put pressure on Wheaton.

Thus, harping on the CRA news months after it was announced is unnecessary right now, especially as the case is still pending...