Now trading at a price of $36.49, Newmont has moved 0.4% so far today.
Newmont returned losses of -17.0% last year, with its stock price reaching a high of $55.41 and a low of $33.59. Over the same period, the stock underperformed the S&P 500 index by -33.0%. As of April 2023, the company's 50-day average price was $38.02. 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 4.4% dividend yield over the last 12 months.
The Company May Be Profitable, but Its Balance Sheet Is Highly Leveraged:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (MM) | $7,253 | $9,740 | $11,497 | $12,222 | $11,915 | $11,196 |
| Gross Margins | 11% | 13% | 24% | 10% | 2% | -2% |
| Operating Margins | 10.0% | 38.0% | 27.0% | 9.0% | 0.0% | -2.0% |
| Net Margins | 5.0% | 30.0% | 25.0% | 10.0% | 1.0% | 0.0% |
| Net Income (MM) | $381 | $2,956 | $2,829 | $1,166 | $60 | $38 |
| Net Interest Expense (MM) | $188 | $2,416 | $337 | -$87 | -$62 | $204 |
| Depreciation & Amort. (MM) | $1,215 | $1,960 | $2,300 | $2,323 | $2,185 | $2,026 |
| Earnings Per Share | $0.64 | $3.81 | $3.51 | $1.46 | -$0.54 | -$0.96 |
| Diluted Shares (MM) | 535 | 737 | 806 | 801 | 795 | 796 |
| Free Cash Flow (MM) | $805 | $1,413 | $3,588 | $2,626 | $1,089 | $310 |
| Capital Expenditures (MM) | $1,032 | $1,463 | $1,302 | $1,653 | $2,131 | $2,317 |
| Net Current Assets (MM) | -$3,926 | -$11,285 | -$8,985 | -$11,007 | -$12,434 | -$12,584 |
| Long Term Debt (MM) | $6,195 | $10,922 | $11,119 | $13,032 | $13,417 | $13,959 |
| Net Debt / EBITDA | 1.72 | 1.58 | 1.04 | 2.34 | 4.91 | 6.22 |
Newmont's financial statements include several red flags such as slimmer gross margins than its peers, declining EPS growth, and a deteriorating pattern of cash flows. Additionally, the firm has a highly leveraged balance sheet. On the other hand, the company benefits from growing revenues and increasing reinvestment in the business and decent operating margins with a negative growth trend.
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 $2.47, the company has a forward P/E ratio of 15.4. 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 1.52. In comparison, the sector average is 2.08.
Newmont Has an Analyst Consensus of Strong Upside Potential:
The 3 analysts following Newmont have set target prices ranging from $53.26 to $82.64 per share, for an average of $72.38 with a hold rating. As of April 2023, the company is trading -47.5% 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 6.3% 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 $3,387,631,999.
