Cash Flow Is King: Evonik, RE Royalties and Wheaton Precious Metals

Wheaton Precious Metals Stock: Do Record Margins and Cash Flow Justify the Next Rally?

The shares of Wheaton Precious Metals (WKN: A2DRBP | ISIN: CA9628791027 | Ticker: WPM) are already up about 11% so far in 2026 and approximately 34% over the past 52 weeks. Its market capitalization stands at around USD 60 billion. Since the beginning of August, the share has gained about 18%. Wheaton does not operate its own mines but instead provides upfront financing to mining companies. In return, the company receives an agreed-upon share of metal production over the long term at predetermined contract prices. This streaming model explains the exceptionally high margins.

At the end of 2025, total assets amounted to USD 9.13 billion. Of this, USD 1.20 billion consisted of current assets and USD 7.92 billion of non-current assets. Total assets were offset by liabilities of only USD 435 million: USD 155 million in current liabilities and USD 281 million in non-current liabilities. Equity therefore stood at a high USD 8.69 billion.

By the end of June 2026, total assets had grown to USD 12.16 billion due to new streams. Long-term assets rose to USD 12.03 billion, while short-term assets fell to USD 130 million due to cash use. At the same time, liabilities increased to USD 2.47 billion, of which USD 279 million were short-term, and USD 2.19 billion were long-term. Shareholders' equity reached USD 9.69 billion.

Revenue jumped 80% to USD 2.31 billion in 2025. The gross margin reached approximately 72%, the operating margin 68%, and the net margin an exceptional 64%. Net income amounted to USD 1.47 billion. The positive trend continued in the second quarter of 2026. Revenue rose by 85% to USD 929 million. The gross margin improved to 74%, and the operating margin to just under 72%. The bottom line was a profit of USD 543 million, corresponding to a net margin of around 58%.

Cash flow is also growing stronger. In 2025, Wheaton generated USD 1.90 billion in operating cash flow. Of this, USD 1.28 billion was allocated to new streaming contracts and USD 296 million to dividend payments, resulting in a USD 335 million increase in cash reserves. In the first half of 2026, operating cash flow then rose yet again by 82% to USD 1.42 billion; Q2 alone generated USD 650 million. However, due to the USD 4.3 billion Antamina investment, USD 1.93 billion in loans was taken out to finance the project. Consequently, cash reserves fell to USD 100 million.

Exciting prospects for the future: Wheaton holds streaming and royalty rights to 57 assets, including 22 producing mines. By 2030, annual production is expected to rise by about 50% to 1.2 million gold-equivalent ounces and remain at this level through 2035.

The Antamina investment has significantly increased debt, but it is supported by high margins and cash flows. The key question now is whether Antamina will be able to deliver the expected additional silver shipments in the future. On the Toronto Stock Exchange, WPM is trading at around CAD 186 (~EUR 114), above all moving averages. The 200-day moving average stands at about CAD 173. The chart looks bullish, but two stubborn resistance zones lie between CAD 196 and 209. Only a sustained breakout above these levels will pave the way for new all-time highs.

RE Royalties: Scalable Royalty Model in the US Solar Boom

Global energy demand is experiencing a historic surge driven by AI data centers and electrification. In the US alone, according to the US Energy Information Administration (EIA), solar, wind, and storage projects accounted for approximately 90% of new electricity capacity in 2025 and are expected to rise to about 93% this year. In this market environment, RE Royalties (WKN: A2PN0F | ISIN: CA75527Q1081 | Ticker Symbol: Y2V) is positioning itself with a highly profitable niche model for the energy transition. The Canadian company has successfully adapted the royalty principle, which has proven effective in the mining industry, to the renewable energy sector. Instead of shouldering high risks as a plant operator, the company acts as an investor and, in return, receives long-term revenue shares.

The scalability of this model is demonstrated by the expanded partnership with the American developer Solaris Energy. RE Royalties has just invested a third tranche of USD 1 million in a portfolio, bringing its total commitment to USD 4.8 million. At the same time, a new memorandum of understanding outlines plans to expand financing to a volume of up to USD 67.5 million. This pipeline comprises a total of 96 solar projects in the United States with a capacity of 190 megawatts. Each project guarantees the financier predictable returns over 25 years as well as for the remaining operational life of the projects.

"With this additional capital, we are accelerating the expansion of our growing portfolio and efficiently advancing projects from the development phase through construction. RE Royalties' investment supports the ongoing debt and tax-equity financing for our first portfolio as an independent power producer (IPP), while its commitment to our broader project pipeline further strengthens our long-term growth strategy…," said Nick Perugini, Chief Executive Officer of Solaris Energy.

To date, RE Royalties has invested more than CAD 83 million, which over the years has resulted in a diversified portfolio of 135 projects. The underlying investments comprehensively cover solar, wind, biogas, hydropower, and battery storage. Through a mix of license purchases and secured bridge financing, the capital achieves an average return of approximately 19%. The steady cash flows are reinvested highly efficiently and drive organic growth. From a technical analysis perspective, the share is currently trading at around CAD 0.38 at the 50-day EMA, and the 200-day moving average is rising at approximately CAD 0.34, providing downside support for the stock. A procyclical buy signal would only be generated if the share closes above CAD 0.45.

Evonik on the Rise: Strong Cash Flow – Will It Now Break Above EUR 18.25?

The specialty chemicals group Evonik Industries (WKN: EVNK01 | ISIN: DE000EVNK013 | Ticker: EVK) is currently trading at around EUR 17.90. Since the start of the year, the share has gained an impressive 35%, though over a 52-week period, the gain is only 7%. Recent tailwinds have come from robust Q2 figures and an upgraded full-year outlook. In the second quarter of 2026, Evonik increased revenue by 11% to EUR 3.89 billion, with organic growth reaching as high as 14%. Adjusted EBITDA improved by 24% to EUR 630 million, and the EBITDA margin rose from 14.5% to 16.2% compared to the same quarter last year. The profit picture is mixed. Net income fell by 30% to EUR 84 million. This was weighed down by one-time items totaling EUR 207 million, including the exit from the polyester business, impairment charges at Oxeno, and legal costs. On an adjusted basis, however, net income jumped by 85% to EUR 296 million. Operationally, the quarter was thus stronger than the net result suggests.

But what exactly does Evonik do? The company produces and sells specialty chemicals to other manufacturers. These include methionine for animal feed, silica for tires and toothpaste, additives for coatings, adhesives, and plastics, as well as active ingredients and delivery systems for pharmaceuticals. This creates niches with attractive margins, but it does not make Evonik independent of economic cycles and energy prices.

Cash flow developed particularly positively. In Q2, operating cash flow amounted to EUR 229 million, compared with a negative EUR 35 million in the same quarter of the previous year. Cash flow from investing and financing activities stood at negative EUR 161 million and negative EUR 270 million, respectively. In the first half of the year, operating cash flow rose to EUR 636 million, and free cash flow increased from a negative EUR 16 million to EUR 232 million. Investments are thus once again being financed from ongoing operations.

By way of comparison: in 2025, revenue fell by 7% to EUR 14.07 billion. Adjusted EBITDA reached EUR 1.87 billion with a margin of 13.3%. The gross margin was 23.1%, while the net margin, with a profit of EUR 265 million, was only 1.9%. Operating cash flow amounted to EUR 1.44 billion, and free cash flow to EUR 695 million.

As of June 30, 2026, total assets stood at EUR 18.62 billion. Equity amounted to EUR 7.93 billion, representing 42.6%, while long-term liabilities stood at EUR 6.90 billion and short-term liabilities at EUR 3.79 billion. For 2026, Evonik now expects adjusted EBITDA of EUR 2.0 to 2.2 billion. A strong animal nutrition business and supply issues among Asian competitors are providing tailwinds. However, this special advantage could fade again in the coming quarters.

From a technical analysis perspective, the share is trading above all key moving averages; the 200-day moving average stands at EUR 15.32. The resistance zone between EUR 18 and EUR 18.50 is critical. A sustained breakout above the May high of EUR 18.25 could pave the way toward EUR 20. If it fails, a consolidation with a pullback to the 200-day moving average would be likely.

Wheaton Precious Metals (WPM) is scaling up its highly profitable streaming model with strong cash flow and is aiming to break out above key resistance levels toward new all-time highs.

RE Royalties, like WPM, finances high-yield renewable energy projects via a royalty model and is growing profitably amid the current US solar boom.

Evonik is delivering robust revenue growth and strong cash flow and is currently testing the key technical resistance level at EUR 18.25.