Now trading at a price of $40.38, Newmont has moved -0.7% so far today.
Newmont returned losses of -8.0% last year, with its stock price reaching a high of $55.41 and a low of $37.45. Over the same period, the stock underperformed the S&P 500 index by -18.0%. As of April 2023, the company's 50-day average price was $42.57. Newmont Corporation engages in the production and exploration of gold. Based in Denver, CO, the large-cap Basic Materials company has 14,600 full time employees. Newmont has offered a 4.3% dividend yield over the last 12 months.
Increasing Revenues but Narrowing Margins:
| 2021-02-18 | 2022-02-24 | 2023-02-23 | |
|---|---|---|---|
| Revenue (MM) | $11,497 | $12,222 | $11,915 |
| Gross Margins | 56.4% | 55.5% | 45.7% |
| Operating Margins | 28.2% | 16.3% | 13.5% |
| Net Margins | 24.61% | 9.54% | -3.6% |
| Net Income (MM) | $2,829 | $1,166 | -$429 |
| Net Interest Expense (MM) | -$308 | -$274 | -$227 |
| Depreciation & Amort. (MM) | -$2,300 | -$2,323 | -$2,185 |
| Earnings Per Share | $3.51 | $1.46 | -$0.7 |
| EPS Growth | n/a | -58.4% | -147.95% |
| Diluted Shares (MM) | 806 | 800 | 795 |
| Free Cash Flow (MM) | $6,184 | $5,932 | $5,351 |
| Capital Expenditures (MM) | -$1,302 | -$1,653 | -$2,131 |
| Net Current Assets (MM) | -$8,985 | -$11,007 | -$12,434 |
| Current Ratio | 2.52 | 2.9 | 2.23 |
| Long Term Debt (MM) | $7,038 | $6,475 | $6,399 |
| Net Debt / EBITDA | 0.46 | 0.63 | 2.37 |
Newmont has stable revenues and increasing reinvestment in the business, a steady stream of strong cash flows, and an excellent current ratio. The company also benefits from wider gross margins than its peer group, decent operating margins with a negative growth trend, and healthy leverage. However, the firm has declining EPS growth.
Newmont does not have a meaningful trailing P/E ratio since its earnings per share are currently in the red. Based on its EPS guidance of $3.35, the company has a forward P/E ratio of 12.7. In comparison, the average P/E ratio for the Basic Materials sector is 10.03. On the other hand, the market is undervaluing Newmont in terms of its equity because its P/B ratio is 1.67. In comparison, the sector average is 2.08. In conclusion, Newmont's impressive cash flow trend, decent P/B ratio, and reasonable use of leverage demonstrate that the company may still be fairly valued — despite its elevated earnings multiple.
Newmont Has an Average Rating of Hold:
The 3 analysts following Newmont have set target prices ranging from $53.45 to $94.43 per share, for an average of $76.89 with a hold rating. As of April 2023, the company is trading -44.6% away from its average target price, indicating that there is an analyst consensus of strong upside potential.
Newmont has an average amount of shares sold short because 3.4% of the company's shares are sold short. Institutions own 82.1% of the company's shares, and the insider ownership rate stands at 0.11%, suggesting a small amount of insider investors. The largest shareholder is Blackrock Inc., whose 12% stake in the company is worth $3,836,592,385.
