Newmont Corporation (NEM): What is the Risk Factor?

Newmont Corporation (NYSE:NEM) saw an upside of 0.65% on Monday to $54.67 after adding $0.36. The 5-day average trading volume is 4,928,158 shares of the company’s common stock. It has gained $55.75 in the past week. An average of 6,120,714 shares of the company has been traded in the last 20 days, and the 50-day average volume stands at 5,496,774.

NEM’s 1-month performance is -5.23% or -$2.12 on its low of $53.03 reached on 10/06/21. The company’s shares have touched a 52-week low of $53.03 and high of $75.31, with the stock’s rally to the 52-week high happening on 05/19/21. YTD, NEM has lost -9.32% or -$5.02. However, the current price is down -27.41%% from the 52-week high price.

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Insider Transactions

On Oct 04, 7 days have gone by since the last insider trading activity for Newmont Corporation (NEM). Rhodes Blake (SVP, Strategic Development) most recently sold 500 shares at $55.00 per share on Oct 04. This transaction cost the insider $27,500. President & CEO, Palmer Thomas Ronald, sold 7,000 shares at a price of $54.65 on Oct 01. Then, on Sep 30, EVP & CFO Buese Nancy sold 10,000 shares at a price of $52.29 per share. This transaction amounted to $522,900.

Valuation Metrics

The company’s PE ratio for the last five years has touched a high of 699.00 and a low of 10.46. NEM stock has a beta of 0.25. Moving on to other valuation ratios, the trailing price-to-sales (P/S) ratio is 3.49 while the price-to-book (PB) in the most recent quarter is 1.87, with the price to cash flow ratio at 19.76.

Newmont Corporation pays an annual dividend of $2.20 per share. Its dividend yield is 4.02% and the payout ratio is 48.90%. NEM’s most recent quarterly dividend payment was made on Sep. 23, when it paid $0.55 a share compared with prior rate of $0.55, down 0.0% from last year’s. The company has boosted its dividend for the last 1 consecutive years with the latest dividend increase of $0.15 reported on Wednesday February 17 2021. Measured over the last 3 years, the Dividend has been growing by 316.00% yearly.

It is projected that Newmont Corporation’s next ex-dividend date will be on 10-Dec. NEM is expected to distribute $0.55 as its next dividend.

Newmont Corporation’s quick ratio for the period ended June 29 was 2.00, with the current ratio over the same period at 2.70 meaning that NEM stock is able to fulfill its debt obligations. As well, the company’s long term debt to equity for the quarter ending June 29 was 0.24, while the total debt to equity was 0.26. In terms of profitability, the gross margin trailing 12 months is 58.70%. The trailing 12-month EBITDA margin is 49.31% while for the period ending June 29; Newmont Corporation’s operating margin was 29.90%. The firm’s gross profit as reported stood at $6.48 billion against revenue of $11.5 billion.

Earnings Surprise

For the quarterly period ending June 29 this year, Newmont Corporation’s cash and short-term investments amounted to $222.0 million against total debt of $6.26 billion. Net income and sales went up compared to those figures reported in the previous quarter. Net income grew 22.84% to $3.06 billion, while revenue of $2.87 billion was 6.3% off the previous quarter. Analysts expected NEM to announce $0.78 per share in earnings in its latest quarter, but it posted $0.83, representing a 6.40% surprise. EBITDA for the quarter stood at more than $1.52 billion. NEM stock balance sheet for the quarter ending June 29 shows that total liabilities totaled 16.62 billion, with total debt at $6.26 billion. Shareholders hold equity totaling $799.13 million

Technical Picture

Let’s look briefly at Newmont Corporation (NEM) price momentum from a technical analysis perspective. The 9-day relative strength index as at close on 08 October was 51.03% to suggest the stock is trending Neutral, with historical volatility in this time period at 20.68%.

The stock’s 5-day moving average is $54.43, reflecting a +0.37% or $0.20 change from its current price. NEM is currently trading -3.80% above its 20-day SMA, -25.51% above its 100-day SMA. However, the stock’s current price level is away from the SMA50 and SMA200 by -12.66% and -8.21% respectively.

Stochastic %K and %D was 58.38% and 52.79% and the average true range (ATR) pointed at 1.25. The RSI (14) points at 46.57%, while the 14-day stochastic is at 67.62% with the period’s ATR at 1.24. The stock’s 9-day MACD Oscillator is pointing at 0.33 and 0.35 on the 14-day charts.

Analyst Ratings

In the most recent analyst report for Newmont Corporation (NYSE: NEM), KeyBanc Capital Markets launched coverage with a Sector weight rating. Analysts offering their rating for NEM stock have a consensus rating for the stock as Overweight. Currently, 0 brokerage advisors rate NEM as a “sell,”, while 6 advise that investors “Hold.” 0 analysts have rated the stock as underweight. 2 rates the stock as overweight while 13 have offered a “buy” rating.

What is NEM’s price target for the next 12 months?

Analysts have a consensus price target ranging from a low of $58.00 and a high of $82.00, with their median price target at $71.50. Looking at these predictions, the average price target given by analysts is for Newmont Corporation (NEM) stock is $72.21.


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