Is Wheaton Precious Metals (TSX:WPM) Still Undervalued Despite a Near 100% YTD Share Price Surge?

The question on every investor's mind is whether Wheaton Precious Metals (WPM) has already priced in all its future potential-or if the stock still offers a compelling opportunity despite its near 100% year-to-date (YTD) surge. Let's cut through the noise with a hard look at valuation metrics, industry comparisons, and the company's financial muscle to determine if WPM is still a buy, a hold, or a sell.

Valuation Metrics: A Premium Stock, But Is It Justified?

WPM's current Price-to-Earnings (P/E) ratio of 31.30 sits near its five-year average of 34.11, suggesting the market isn't overpaying based on historical context. However, this ratio is a stark 54.16x as of December 19, 2025 dwarfs the Basic Materials sector average of 25.54. For perspective, the South American Metals and Mining industry average P/E is a mere 9.8x while WPM trades at 52.3x. This premium valuation isn't just a number-it's a statement. The market is betting big on WPM's ability to outperform its peers, but can it deliver?

The Price-to-Book (P/B) ratio of 6.75 is another red flag. At 91.3% higher than its five-year average of 3.53, WPM is trading at a multiple that suggests investors are pricing in aggressive growth. Meanwhile, the Enterprise Value-to-EBITDA (EV/EBITDA) ratio of 20.93 is closer to its five-year average of 21.89, offering a more neutral signal. This mixed bag tells us WPM is expensive relative to book value but fairly valued based on operating earnings.

Industry Comparisons: A Tale of Two Valuations

The South American Metals and Mining sector is a patchwork of valuations. For instance, Compañía de Minas Buenaventura trades at a modest 15.7x P/E while Silvercorp Metals and Hecla Mining sport eye-popping multiples of 69.68x and 61.39x, respectively. WPM's 52.3x P/E sits comfortably in the "high flyer" category, but its robust financials and low-cost production profile justify the premium. Unlike peers like Buenaventura, WPM's growth isn't speculative-it's anchored in proven assets and a disciplined capital structure.

Financial Performance: A Rocket Ship in a Gold Mine

Wheaton's Q3 2025 results are nothing short of explosive. Revenue hit $476 million, up 54.5% year-over-year, driven by a 37% jump in gold-equivalent prices and a 12.5% increase in gold-equivalent ounces (GEOs) sold according to the Q3 2025 breakdown. Net earnings surged 137.5% to $367 million, with operating cash flow climbing 50.6% to $383 million according to the Q3 2025 breakdown. These numbers aren't just impressive-they're transformative.

The company's 2025 production guidance of 600,000–670,000 GEOs is equally compelling. With 83% of production coming from low-cost assets, WPM is insulated from the margin-crushing volatility that plagues higher-cost producers. Ongoing projects like Mineral Park, Platreef, and Fenix add a layer of de-risked growth, while the recent gold stream on the Hemlo Mine and partnership with Waterton Gold Corp. open new avenues for expansion.

Balance Sheet Strength and ESG Leadership: The Full Package

WPM's financial fortress is a key differentiator. It holds $1.2 billion in cash, has no debt, and maintains an undrawn $2 billion revolving credit facility according to Q3 2025 results. This liquidity isn't just a safety net-it's a weapon. In a sector prone to boom-and-bust cycles, WPM's balance sheet gives it the flexibility to acquire assets, fund projects, or return capital to shareholders without relying on volatile markets.

On the ESG front, WPM is a top-tier performer. It holds AAA ratings from MSCI, is ranked among the top 10 companies in Canada's Best 50 Corporate Citizens, and has committed $8.5 million to community programs in 2024 according to the Q3 2025 results. In an era where sustainability is no longer optional, WPM's ESG credentials are a competitive edge that could attract a new wave of ESG-focused investors.

The Verdict: Premium Priced, But Justified

So, is WPM still undervalued? The answer hinges on your risk tolerance and time horizon. At a 52.3x P/E and 6.75x P/B, WPM is undeniably expensive compared to its peers. However, its 54.5% revenue growth, low-cost production, expansive project pipeline, and bulletproof balance sheet justify the premium. The EV/EBITDA ratio of 20.93 suggests the company isn't overpaying for growth relative to its operating performance.

For long-term investors, WPM remains a buy-but with a caveat. The stock's valuation is tied to gold prices and global macroeconomic conditions. If gold dips or interest rates rise sharply, the premium could compress. However, given WPM's track record of outperforming industry averages and its disciplined capital allocation, the risks are manageable.

Short-term traders, on the other hand, might want to wait for a pullback. The stock has already priced in much of its near-term potential, and the high P/E leaves little room for error.

In the end, WPM is a classic case of "expensive but worth it." If you're in for the long haul and believe in the gold sector's resilience, this is a stock to hold. If not, take profits and ride the next wave.