Earnings Preview: Newmont Mining Corporation

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 |  About: Newmont Mining Corporation (Holding Company) (NEM), Includes: ABX, FCX, GG, GOLD, KGC
by: Vytautas Drumelis

Newmont Mining Corp. (NEM) is scheduled to report its Q2 2012 results on July 27, 2012, before market opens. The street expects EPS and revenue of $0.93 and $2.52B, respectively.

In this article I will recap the historical results of the company, its latest EPS estimates vs. surprises, the latest news from NEM and the news from its closest competitors.

Newmont Mining Corp. Revenue and Net Income History

Recent EPS Actuals vs. Estimates

In the last quarter it reported $1.15 EPS, just beating analyst estimates of $1.14.

Newmont Mining Corp. EPS Historical Results vs Estimates

The consensus EPS estimate is $0.93 based on 15 analysts' estimates, up from $0.90 a year ago. Revenue estimates are $2.52B, up from $2.38B a year ago. The median target price by analysts for the stock is $65.00.

Average recommendation: Overweight

Source: Marketwatch

Analyst Upgrades and Downgrades

  • On January 31, 2012, Stifel Nicolaus downgraded the company from Buy to Hold.

Latest News

  • On July 25, 2012, Newmont Mining Corporation announced that its Board of Directors declared a quarterly dividend of $0.35 per share of common stock, payable on September 28, 2012, to holders of record at the close of business on September 6, 2012.
  • On April 27, 2012, Newmont Mining Corporation announced that for fiscal 2012, it expects attributable gold and copper production of approximately 5.0 to 5.2 million ounces and 150 to 170 million pounds, respectively, at CAS of approximately $625 to $675 per ounce and $1.80 to $2.20 per pound, respectively.
  • On March 9, 2012, Newmont Mining Corporation announced that it has received aggregate net proceeds of approximately $2,460 million, after deducting underwriting discounts and estimated expenses, upon the closing of its registered public offering of $1.5 billion principal amount of 3.500% senior notes due 2022 and $1.0 billion principal amount of 4.875% senior notes due 2042.
  • On March 6, 2012, Newmont Mining Corporation announced the pricing of its public offering of $2.5 billion of senior notes, consisting of 3.500% senior notes due 2022 in the principal amount of $1.5 billion and 4.875% senior notes due 2042 in the principal amount of $1.0 billion (Notes).
  • On March 5, 2012, Newmont Mining Corporation announced its intention to offer, subject to market and other conditions, senior unsecured notes pursuant to the Company's shelf registration statement filed with the Securities and Exchange Commission.
  • On February 22, 2012, Newmont Mining Corporation announced that its Board of Directors declared a quarterly dividend of $0.35 per share of common stock, payable on March 29, 2012, to holders of record at the close of business on March 15, 2012.
  • On January 26, 2012, Premier Gold Mines Ltd. announced that it has signed a Letter of Intent to enter into a joint venture with NEWMONT USA LIMITED, a subsidiary of Newmont Mining Corporation (Newmont) to consolidate the Saddle and Rain projects within the Rain Sub-district of Nevada's prolific Carlin Trend.

Competitors

Barrick Gold Corporation (ABX), Freeport-McMoRan Copper & Gold (FCX), Goldcorp (GG), Randgold Resources (GOLD), and Kinross Gold Corporation (KGC) are considered major competitors for Newmont Mining Corporation and the table below provides the key metrics for these companies and the industry.

Newmont Mining Corp. key ratio comparison with direct competitors

The chart below compares the stock price changes as a percentage for the selected companies for the last one year period.

NEM ChartClick to enlarge

NEM data by YCharts

Competitors' Latest Development

  • On July 24, 2012, Reuters reported that Freeport-McMoRan Copper & Gold Inc. has offered a 9.36% stake in its Indonesia operations that run the second-biggest copper mine to the Southeast Asian country's government, a move aimed at deflecting pressure from new industry rules on project ownership.
  • On July 11, 2012, Goldcorp Inc announced that for fiscal 2012, it revises gold production guidance to be between 2.35 and 2.45 million ounces compared to previous guidance of 2.6 million ounces.
  • On July 9, 2012, Canada Stockwatch News reported that Goldcorp Inc. has declared its seventh monthly dividend payment for 2012 of $0.045 per share. Shareholders of record at the close of business on July 19, 2012, will be entitled to receive payment of this dividend on July 27, 2012.
  • On June 28, 2012, Kinross Gold Corporation announced that, further to the Company's news release dated May 29, 2012, it has completed the sale of its 50% interest in the Crixas (Serra Grande) gold mine in Brazil to an affiliate of AngloGold Ashanti for gross cash proceeds of $220 million.
  • On June 27, 2012, Barrick Gold Corp announced that the Ontario Superior Court of Justice issued its ruling on June 26, 2012, with respect to the El Morro mining project, finding against the position of Barrick Gold Corp.
  • On June 26, 2012, Barrick Gold Corp announced that Ammar Al-Joundi has been named Executive Vice President and Chief Financial Officer of the Company, effective July 10, 2012.
  • On June 20, 2012, Candente Gold Corp announced that the Company has fulfilled all requirements necessary to complete the exercise of its second option to earn an undivided 70% interest in the El Oro Gold Project located in Mexico and Michoacan States of Mexico, from Goldcorp S.A. de C.V. a subsidiary of Goldcorp Inc. Candente Gold completed the first option and earned a 50% interest in the property on February 15 2011, by incurring $5 Million in exploration expenditures, and issuing 1,000,000 shares in the capital of the Company.
  • On June 6, 2012, Barrick Gold Corp announced that its Board of Directors has appointed Executive Vice President and Chief Financial Officer Jamie Sokalsky as President and Chief Executive Officer, replacing Aaron Regent.
  • On June 6, 2012, Reuters reported that Kinross Gold said that workers at its Tasiast gold mine in Mauritania in West Africa have initiated an unlawful work stoppage, halting mining and processing activity at the operation.
  • On June 4, 2012, Goldcorp Inc announced that it is to declare its sixth monthly dividend payment for 2012 of $0.045 per share. Shareholders of record at the close of business on June 14, 2012 will be entitled to receive payment of this dividend on June 22, 2012.
  • On May 29, 2012, Kinross Gold Corporation announced that it has entered into a purchase and sale agreement with subsidiaries of AngloGold Ashanti Ltd., pursuant to which Kinross will sell its 50% interest in the Crixas gold mine (Serra Grande), located in the State of Goias, Brazil, to AngloGold Ashanti for gross cash proceeds of USD220 million.
  • On April 19, 2012, Freeport-McMoRan Copper & Gold Inc. announced that fiscal 2012, it expects 3.7 billion pounds of copper sales. 1.1 million ounces of gold. 81 million pounds of molybdenum.
  • On February 13, 2012, Freeport-McMoRan Copper & Gold Inc. announced that it has completed the sale of $3.0 billion of senior notes. The offering generated net proceeds of approximately $2.97 billion, which FCX expects to use plus cash on hand to redeem its outstanding 8.375% Senior Notes due 2017.
  • On February 7, 2012, Freeport-McMoRan Copper & Gold Inc. announced that its Board of Directors has authorized an increase in its annual common stock dividend from $1.00 per share to $1.25 per share.

Technical Overview


The stock has a market capitalization of $21.75B and is currently trading at $44.33 with a 52 week range of $43.23 - $72.42. The stock's year-to-date performance has been -25.14%. It is currently trading below 20, 50 and 200 SMA.

Sources: Yahoo Finance, Google Finance, Marketwatch, Finviz, Reuters.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.