Wheaton Precious Soars 3.25% on Hemlo Gold Stream Deal – Is This the Catalyst for a New Bull Run?

Summary
• Wheaton Precious Metals (WPM) surges 3.25% to $112.82, nearing its 52-week high of $114.36
• A $300M gold stream with Hemlo Mining adds 0.19M oz of reserves, boosting long-term production visibility
• RBC Capital upgrades WPM to Outperform, raising price target to $130
• Technicals show a short-term bullish trend with RSI at 60.9 and MACD above signal line
Wheaton Precious Metals is riding a wave of optimism as a strategic gold stream deal and analyst upgrades fuel a sharp intraday rally. With the stock trading near its 52-week peak and technical indicators aligning with a bullish bias, investors are weighing whether this momentum can sustain or if caution is warranted amid a crowded streaming market.

Hemlo Gold Stream and Analyst Upgrades Ignite Momentum
Wheaton’s 3.25% intraday surge is directly tied to its $300M gold stream agreement with Hemlo Mining, which secures 0.19M oz of proven and probable gold reserves. This deal enhances contracted cash flow and production visibility, aligning with RBC Capital’s recent upgrade to Outperform. Analyst Josh Wolfson cites the company’s growth profile from existing projects like Salobo and Blackwater, projecting 45% production growth by 2030. The upgrade, coupled with a $0.165 dividend hike through 2025, underscores management’s confidence in balancing capital returns with long-term value creation.

Precious Metals Sector Gains Momentum as Gold and Silver Hit Records
The broader precious metals sector is surging, with gold breaching $4,200/oz and silver hitting a record $51. Wheaton’s rally mirrors this trend, as streaming companies benefit from tightening supply and rising demand. Sector leader Newmont (NEM) is up 1.09% intraday, reflecting shared tailwinds. However, Wheaton’s 49.5x P/E ratio remains elevated compared to the sector’s 26.9x, signaling potential multiple compression risks if growth expectations soften.

Bullish Technicals and High-Leverage Options for a Breakout Play
• 200-day MA: $91.86 (well below current price)
• RSI: 60.9 (neutral to bullish)
• MACD: 1.73 (bullish divergence)
• Bollinger Bands: Price at $112.82, above the upper band of $111.98
• Support/Resistance: Key near-term support at $107.14–$108.04; resistance at $114.36 (52W high)
Wheaton’s technicals suggest a continuation of the bullish trend, with the 52-week high acting as a critical psychological barrier. The stock’s proximity to its upper Bollinger Band and positive MACD histogram indicate strong momentum. For options traders, two contracts stand out:

• WPM20251219C110
- Type: Call
- Strike: $110
- Expiration: 2025-12-19
- IV: 37.35% (moderate)
- Leverage Ratio: 24.08% (high)
- Delta: 0.694 (moderate sensitivity)
- Theta: -0.384 (rapid time decay)
- Gamma: 0.0501 (high sensitivity to price moves)
- Turnover: 20,578 (liquid)
- Payoff (5% upside): $118.41 → $8.41 gain per contract
- Why it stands out: High leverage and gamma make this ideal for a breakout above $114.36, with liquidity ensuring smooth entry/exit.

• WPM20251219C112
- Type: Call
- Strike: $112
- Expiration: 2025-12-19
- IV: 25.10% (reasonable)
- Leverage Ratio: 43.87% (very high)
- Delta: 0.617 (moderate sensitivity)
- Theta: -0.329 (rapid decay)
- Gamma: 0.0812 (extremely high sensitivity)
- Turnover: 9,553 (liquid)
- Payoff (5% upside): $118.41 → $6.41 gain per contract
- Why it stands out: Exceptional gamma and leverage amplify returns if the stock breaks above $114.36, with moderate IV reducing premium costs.

Trading View: Aggressive bulls should target the $114.36 52W high as a catalyst for a $130+ move. Use WPM20251219C112 for high-gamma exposure or WPM20251219C110 for a balanced breakout play.

Backtest Wheaton Precious Stock Performance
The backtest of WPM's performance after an intraday surge of at least 3% from 2022 to the present shows favorable results. The 3-day win rate is 54.72%, the 10-day win rate is 56.89%, and the 30-day win rate is 62.01%, indicating a higher probability of positive returns in the short term. The maximum return during the backtest was 6.09%, which occurred on day 59, suggesting that WPM can deliver decent gains following a 3% intraday surge.

Breakout or Bubble? Wheaton’s 52W High is the Crucial Crossroads
Wheaton Precious Metals’ rally hinges on its ability to break above $114.36, the 52-week high, to validate the bullish technical setup. A successful breakout could trigger a retest of RBC’s $130 target, but investors must monitor sector leader Newmont (NEM, +1.09% intraday) for broader market sentiment. If gold and silver maintain their record highs, WPM’s streaming model could outperform. However, elevated valuations and competition for deals remain risks. Action: Buy WPM20251219C112 for a high-gamma play if $114.36 breaks; watch NEM’s performance as a sector barometer.