|Bid||0.00 x 0|
|Ask||0.00 x 0|
|Day's range||36.85 - 37.37|
|52-week range||33.89 - 42.04|
|PE ratio (TTM)||420.68|
|Earnings date||26 Jul 2018|
|Forward dividend & yield||0.56 (1.48%)|
|1y target est||44.46|
The stock has significantly underperformed its close peers Goldcorp (GG), Newmont Mining (NEM), and Agnico Eagle Mines (AEM), which returned 3.6%, -1.8%, and -1.4%, respectively. The VanEck Vectors Gold Miners ETF (GDX) returned -5.5% over the same period. Some of the same issues are still affecting the stock today. See Market Realist’s series A Look at Barrick Gold after Its 1Q18 Earnings Beat for more on Barrick Gold’s outlook.
Investors are typically interested in gold mining companies’ (GDX)(GDXJ) ability to generate FCF (free cash flow) because FCF helps them invest in future growth—apart from the aim of returning cash to shareholders.
In this part, we’ll discuss what analysts expect for these gold miners’ (RING) earnings. In line with lower revenues, Barrick Gold’s (ABX) EBITDA are also expected to fall. Barrick is expecting its all-in sustaining costs for 2018 to be $765–$815 per ounce, compared to $710–$770 per ounce in 2017.
At extreme levels, these ratings could even signal a change in direction, so it’s important for investors to track this data. In the senior and intermediate gold miner space (GDX)(GDXJ), analysts are the most bullish on IAMGOLD (IAG), with 75.0% of analysts assigning it a “buy.” Plus, 25.0% rated it as a “hold,” and there were no “sell” ratings. Goldcorp (GG) comes next with 70.0% “buy” ratings and 25.0% “hold” ratings.
Gold prices have declined ~5.0% YTD (year-to-date) after rising ~13.0% in 2017. Gold is hitting lows despite factors that favor its safe-haven status. Despite the escalation of trade war fears and political tensions in the European Union, gold prices have been trending lower.
Newmont Mining Corporation (NEM) (Newmont or the Company) has completed its Northwest Exodus project, extending mine life from the Exodus underground operation in the Carlin North area for 10 years. Northwest Exodus marks Newmont’s second profitable expansion in the last month adding higher-grade, lower-cost gold production in Nevada. Featuring fit-for-purpose technologies to enhance safety, productivity and efficiency, Northwest Exodus will add between 50,000 and 75,000 ounces of gold production per year and lower Carlin’s all-in sustaining costs by approximately $25 per ounce in the first five years of operation1.
The CFTC (Commodity Futures Trading Commission) reports the position of major players in the futures market through its COT (Commitment of Traders) report. According to the COT report for the week ended June 26, 2018, money managers were barely net long on gold with just over 4,000 net speculative long contracts. According to Commerzbank, “Short positions, in particular, were built up, which means speculative financial investors are currently betting heavily on falling prices.” For the week ended June 3, money managers kept their positions almost unchanged, which implies the lowest levels of net long positioning since late 2015 when gold prices dipped below $1,050 per ounce.
Gold prices have gone through a rough patch recently with prices closing near their seven-month lows. Gold is hitting lows despite many factors that are favoring its safe-haven status. Despite the escalation of trade war fears and political tensions in the European Union, gold prices have been trending lower. While these factors have helped gold, the US dollar is also attracting bids because of these factors, which has capped gold’s gains.
Gold Stayed Weak in the First Half of 2018—Will Its Year Improve? On June 12, Morgan Stanley upgraded Newmont Mining (NEM) from an “equal-weight” to an “overweight” and raised its target price to $40 from $37. The brokerage cited stronger execution, a steadier production profile, a stronger project pipeline, a better reserve life, and lower leverage as the main reasons for its preference of NEM over Barrick Gold (ABX).
Newmont Mining (NEM) and Goldcorp (GG) are the only two senior gold mining stocks that have had positive returns YTD (year-to-date). In the first six months of the year, NEM returned 0.5%, and Goldcorp outperformed its peers significantly with a rise of 7.4%. Newmont Mining reported an earnings beat in the first quarter.
Newmont's (NEM) Twin Creeks Underground expansion project will add 30,000-40,000 ounces of gold per annum at all-in sustaining costs of $650-$750 per ounce.
The gloom in the mining sector is mainly due to the fall in precious metals. Gold, silver, platinum, and palladium have fallen 1.9%, 2.9%, 5.6%, and 0.53%, respectively, on a five-day trailing basis.
Newmont Mining Corporation (NEM) (Newmont or the Company) has achieved commercial production at its Twin Creeks Underground expansion project, adding higher-grade, lower-cost gold production at its Twin Creeks operation in Nevada. The Twin Creeks Underground mine will add between 30,000 and 40,000 ounces of gold production per year at all-in sustaining costs1 of between $650 and $750 per ounce for its first five years of production.
The falling platinum prices have been a major concern for platinum mining companies in Africa. Platinum, like palladium, is used as a catalyst to reduce carbon monoxide emissions in vehicle engines. The platinum market has been in short supply over the last few years, and its deficit is expected to expand in 2018 as well. The same factor that supports palladium prices is also detrimental to platinum prices.
Does the share price for Newmont Mining Corporation (NYSE:NEM) reflect it’s really worth? Today, I will calculate the stock’s intrinsic value by estimating the company’s future cash flows and discountingRead More...
The VanEck Vectors Gold Miners ETF (GDX) has returned -2.3%, and the SPDR Gold Trust (GLD), which tracks gold’s physical price, has returned -0.2%. Kinross Gold was punished mainly because of its exposure to Russia through two of its mines.
Newmont Mining Corporation (NEM) (Newmont or the Company) welcomed Sumitomo Corporation (Sumitomo) as a new and valued partner in Minera Yanacocha SRL (Yanacocha) following its purchase of a five percent stake in the partnership. Newmont, Buenaventura and Sumitomo completed the transaction today in which Sumitomo paid $48 million for the ownership interest in Yanacocha.
Newmont Mining Corporation announced it will report second quarter 2018 operations and financial results before the market opens on Thursday, July 26, 2018 and will hold a conference call at 10:00 a.m.
Gold prices haven't done much this year, but gold stocks have diverged quite a bit, with Barrick Gold (ABX) down some 9% since the start of 2018, while Newmont Mining (NEM) is up more than 3%. Given the stocks' relative performance, some investors may be tempted to scoop up Barrick, on the belief that it's gotten too cheap--but they should resist temptation, says Morgan Stanley's Piyush Sood. Sood argues that Barrick's underperformance looks set to continue through the rest of the year, and ahead of the company's final agreement with the government of Tanzania, he downgraded the shares to Underweight, and shaved $2 off his price target, to $12.
Goldstrike Resources Ltd. (GSR.V) (KCG1.F) (OTC PINK:APRAF) is pleased to provide an update on the 2018 drill program for its 662 km2 Plateau Property in Canada’s Yukon. The district scale drill program is fully funded by Newmont Mining Corporation (NEM) through its Canadian mining division and is forecast to include up to 10,000 meters of diamond drilling, with two drill rigs already onsite. Drilling at Plateau commenced on June 1, 2018 on a large new target generated in the Goldbank area utilizing Newmont’s proprietary technologies. In addition to using Newmont’s proprietary geochemical technologies and airborne geophysical system to generate the target, the geological team used surface mapping and the 2017 IP (induced polarization) survey which indicates the presence of a significant subsurface chargeability anomaly.
Gold and gold miners have been all over the place this year. Often, we think of gold as a safe haven and defensive play, and often it is. But sometimes it’s in its own cycle or just another asset for people to sell in times of trouble. This year, gold is playing its role as a safe haven and is up 3% during a flat and tumultuous market. But for some reason, the miners are acting more like other stocks—and, at some periods, even worse than the market. That behavior is relatively curious, especially given gold’s outperformance.
Let’s talk about the popular Newmont Mining Corporation (NYSE:NEM). The company’s shares saw significant share price volatility over the past couple of months on the NYSE, rising to the highsRead More...
Which Gold Miners Could Show Upside Potential after Q1 2018? As precious metal prices started weakening, investors shifted their focus from high-leverage miners (GDX) (GDXJ) to low-leverage miners with sound growth plans, leading miners to trim their balance sheets. Newmont Mining’s (NEM) net debt at the end of the first quarter was ~$1 billion compared to $1.9 billion at the end of 2016.
Which Gold Miners Could Show Upside Potential after Q1 2018? Since high debt levels can strain a company’s credit rating and growth decisions, it’s important to look at its financial leverage. Barrick Gold (ABX) and Newmont Mining (NEM) were once considered the companies with the highest financial leverage ratios.