Denver-based Newmont Mining Corporation (NEM) is one of the world's largest gold producers, with a market cap of $49.4 billion. Operating in the mining sector, it explores and produces gold, copper, silver, zinc, and lead across various regions.
Shares of the gold miner have significantly underperformed the broader market over the past 52 weeks. NEM has declined around 3% over this time frame, while the broader S&P 500 Index ($SPX) rallied 27.4%. The gap has narrowed slightly in 2024, with NEM’s shares up 4.9%, compared to SPX's 11.1% gains on a YTD basis.
Zooming in further, NEM is also lagging behind the iShares Global Gold Miners ETF's (RING) 15.6% gains over the past 52 weeks.
Newmont Mining's underperformance can be attributed to strategic changes post-Newcrest acquisition, including asset sales and dividend reduction. Geopolitical tensions and economic uncertainties impacting gold prices have also affected NEM's stock performance. However, NEM shares surged by 12.5% on April 25 after reporting Q1 earnings results, surpassing revenue and adjusted EPS expectations, despite a 4% decrease in gold production.
For the current fiscal year, ending in December, analysts expect NEM's EPS to grow by 47.2% to $2.37. The company's earnings surprise history is mixed. It missed estimates in three of the last four quarters while surpassing on one other occasion.
Among the 15 analysts covering the stock, the consensus rating is a “Moderate Buy.” That’s based on six “Strong Buys,” one “Moderate Buy,” and eight “Holds.”
This configuration has been consistent over the past months. However, it is slightly less bullish than a month before, with seven “Strong Buy” ratings.
On May 2, BMO Capital reaffirmed its “Outperform” rating on NEM but lowered its price target for the stock to $54, which is also the Street-high target. This implies a potential upside of 26.1% from the current price levels.
The mean price target of $47.03 represents a premium of just 9.8% to NEM's current levels.
On the date of publication, Anushka Mukherjee did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
