Why This Precious Metals Stock Could Be Good Shares to Buy Now: The Wheaton Model Explained

When an investment compounded at 4,153% since 2005 while the underlying asset (gold) returned just 1,012%, something strategic is clearly working. Wheaton Precious Metals (NYSE: WPM) stands out as precisely this kind of opportunity—not because it mines gold, but because it has engineered a radically different path to profiting from the precious metals market. With just 44 full-time employees generating $35 million in gross profit per person last quarter, this $60 billion company has cracked a code that makes it worthy of consideration as good shares to buy now for investors seeking exposure to rising metal prices.

The Streaming Model: How Wheaton Turns Discounts into Profits

Wheaton Precious Metals operates on a business principle that inverts the traditional mining playbook. Rather than owning and operating dangerous, capital-intensive mine operations, the company functions as a financier with a twist—it provides upfront capital to mining projects and receives the right to purchase portions of their future metal output at predetermined discounts.

Consider the company’s 2025 agreement with Hemlo Mining. Wheaton provided $300 million in financing and secured the right to buy 10.13% of the mine’s gold output (up to 136,000 ounces) at just 20% of the spot price—an 80% discount. This creates an immediate arbitrage opportunity: if gold trades at $4,893 per ounce, Wheaton’s right to purchase 136,000 ounces costs only $133 million but carries a market value of $665.5 million.

The true genius lies in the tiered structure. After the initial 136,000 ounces at the 80% discount, Wheaton transitions to a second tier where it can purchase 6.75% of output (up to 118,000 ounces) at the same discount. Beyond that threshold, it maintains rights to 4.5% of the mine’s remaining production throughout the mine’s operational life—still at the 80% discount. With dozens of similar agreements globally, this model compounds into exceptional returns.

Outperforming Gold: The Numbers Behind the Growth

The performance differential is striking. Over the past five years alone, Wheaton’s shares returned 221% compared to gold’s 187% gain—an outperformance that speaks to the efficiency of the streaming model. Even more recently, shares beat gold’s 90% gain over the last twelve months, according to investment data from early January 2026.

This pattern holds across multiple timeframes. Whether measured over one-year, three-year, five-year, or ten-year periods, the stock has consistently beaten the precious metals they provide access to—typically by a ratio of approximately 2-to-1. This is not luck; it’s structural advantage built into the business design.

The company’s ability to lock in these deep discounts creates what amounts to an embedded hedge against commodity price volatility. Even if gold prices compressed significantly, the substantial discount margin would absorb much of the downside impact.

Financial Efficiency With Minimal Headcount

What separates Wheaton from traditional gold companies isn’t just the business model—it’s the scale achieved with remarkable organizational leanness. Operating with 44 full-time employees while managing a diversified portfolio of mines globally represents extreme operational efficiency.

This headcount translates to approximately $35 million in gross profit per employee quarterly, a metric that would astonish most industrial companies. The company avoids the massive capital expenditures, environmental compliance burdens, and operational risks associated with actually mining—it finances others’ mines instead. This outsourced model allows Wheaton to remain asset-light while capturing significant value through its discount agreements.

Additionally, unlike virtually every other precious metals investment, Wheaton Precious Metals pays a dividend. While the yield of 0.43% is modest, it remains exceptional in an asset class (physical metals) that generates zero income.

Understanding the Risk Profile

The most obvious vulnerability exists in the downside direction: a sharp pullback in gold prices would compress both the company’s profit margins and the intrinsic value of its discount agreements. If gold fell 50%, the $232.5 million profit calculated above from the Hemlo agreement would shrink considerably.

However, this risk is partially mitigated by Wheaton’s discount structure. An 80% reduction from spot prices means the company retains substantial margin cushion. A 30% decline in gold prices would still leave Wheaton profitable on its existing agreements, whereas a pure gold miner operating at marginal costs would face existential challenges. The streaming model acts as a natural shock absorber.

Concentration risk also warrants consideration. A major mine failure or global recession reducing precious metals demand would impact all precious metals investments, but Wheaton’s diversified portfolio across multiple geographies and mining operations reduces this dependency.

The Investment Case

For investors evaluating good shares to buy now within the precious metals sector, Wheaton Precious Metals presents a structural advantage that has proven durable across market cycles. The combination of locked-in discounts, operational efficiency, and demonstrated long-term outperformance creates a compelling profile.

The streaming model has proven its merit through decades of market conditions. Whether precious metals continue their recent rally or face consolidation, Wheaton’s discount architecture and lean operational footprint position it to outperform simple commodity exposure. That track record, along with the company’s unique ability to monetize precious metals without mining risk, supports the case for considering WPM as a vehicle for gaining exposure to this sector.