Entering text into the input field will update the search result below

Newmont: Buy The Dips

Mar. 01, 2022 3:28 PM ETNewmont Corporation (NEM), NGT:CA68 Comments
Taylor Dart profile picture
Taylor Dart


  • Newmont released its Q4 and FY2021 results last month, reporting annual gold production of ~5.97 million ounces at all-in sustaining costs of $1,062/oz.
  • While these costs were above estimates, the company had another challenging year, having to implement a new haulage fleet at Boddington and dealing with COVID-19 headwinds across the portfolio.
  • The good news is that the 5-year guidance points to ~7% growth in annual GEO production (FY2026 vs. FY2022) at declining costs.
  • Based on the fact that Newmont continues to be one of the safest ways to get precious metals exposure with a diversified portfolio, relatively low volatility, and an attractive dividend, I would view pullbacks below $59.30 as buying opportunities.

Mining in the Nevada desert.

gchapel/iStock via Getty Images

The Q4 and FY2021 Earnings Season for the Gold Miners Index (GDX) has finally begun, and Newmont Corporation (NYSE:NEM) was one of the first companies to report its results. Overall, the company

This article was written by

Taylor Dart profile picture
"A bull market is when you check your stocks every day to see how much they went up. A bear market is when you don't bother to look anymore."- John Hammerslough You can access more in-depth research, my current portfolios, new positions I am entering/exiting, and proprietary sentiment indicators for gold miners in my newsletter below.  Returns Link: https://imgur.com/a/6fcWjD6Subscription Link: https://buy.stripe.com/3cseV37nl9Y7dUcaEI - Disclosure: I am not a financial advisor. All articles are my opinion - they are not suggestions to buy or sell any securities. Perform your own due diligence and consult a financial professional before trading or investing.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of GLD, NEM either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Disclaimer: Taylor Dart is not a Registered Investment Advisor or Financial Planner. This writing is for informational purposes only. It does not constitute an offer to sell, a solicitation to buy, or a recommendation regarding any securities transaction. The information contained in this writing should not be construed as financial or investment advice on any subject matter. Taylor Dart expressly disclaims all liability in respect to actions taken based on any or all of the information on this writing. Given the volatility in the precious metals sector, position sizing is critical, so when buying small-cap precious metals stocks, position sizes should be limited to 5% or less of one's portfolio.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (68)

waldipup profile picture
NEM Newmont Corporation $82.86 -2.56

Oh , well , broke again 🤔
Windham Financial profile picture
@waldipup Here is your place to start buying NEM at just above the 50-DMA $ 76.80, if you missed the first leg.
waldipup profile picture
@Windham Financial

I backed up the truck way lower and my tank is full .

But should'a lightened up mid 80's .

Don't forget that the 200dma is lower than the 50 ever since the previous "death cross" had reversed .
waldipup profile picture

Besides , I blew my opp to buy more at 76.80 as it's trading 74 pre market .

Looks like that there 200dma may come into play .
But does it ever dip, Taylor?
bver88 profile picture
"yes Virginia-@Miners to the Moon

there IS a Santa Claus"

is this the 'dip' y'all waiting for ?
Windham Financial profile picture
Bought some PAAS to push the silver envelope on todays breakout, to round out our metals portfolio.
@Windham Financial - you’re done already? How will you entertain yourself over the next 2 days?
waldipup profile picture
Be careful with the SA price charts .

NEM shows an 83.72 "52 wk. high" , but the chart only shows it in the 82's .

Windham Financial profile picture
Took a little NEM off the table and bought some KGC. Both the stock and $ 6 Sept call options.
@Windham Financial, to redeploy into more AEM? And all things silver? This is where my emphasis has been recently.
Windham Financial profile picture
@Miners to the Moon We already own AEM through their purchase of KL. We did increase our AEM position at the time of the purchase. We have been using WPM to increase our sensitivity to silver among the miners. We also own PICK to get some sensitivity to iron ore, nickel, copper and other base metal markets. The ETF also has a strong sensitivity to the Steel Industry. We also own GOLD and SBSW in the platinum group metals area.

We noticed some unusual option activity in KGC and the technical set up was perfect, so we added it to the portfolio. But had to take some profits from elsewhere, since we are at our maximum allocation for the sector.
waldipup profile picture
New leg up beginning?
@waldipup looks like wants to take another leg up....but main thing I want to stay laser focused on is....when you sell!
waldipup profile picture
@tman1 Just don't go by me - I'm always wrong .

Better to use me as a contrary indicator .
@waldipup just messing with you. That was the joke "using you as a contrary indicator"....when you sell, I buy more.
waldipup profile picture
Bought a lot at 58 on a "breakout" in Nov. , , got pissed that it then dropped

to 53 , but kinda worked out ok , though in retrospect was easily buyable at 54 .

Now around 80 , with gold above 1900 .

Above "fair value" now , but what to do?

No doubt if I sell it goes parabolic .......
@waldipup let us know if you sell.
@tman1 - I’m not @waldipup but today I sold 300 shares @ $ 82.35 in one account and later 300 more @ $ 82.65 in another account.

Windham Financial profile picture
@Miners to the Moon We also trimmed 25% of our NEM stock position today at $ 82.68. Could not resist taking a 35% profit on a portion of our holdings. However, we still think the company has plenty of more long-term upside, if the metals can continue higher from these levels. We are also still holding our $ 60 call options that we rolled out into June and are currently up 875% on that position.
bigbenorr profile picture
Well boys, I'm afraid there may not be another dip.....
@bigbenorr I sold this stock way to early.
@Eman13, I sold too much, with what I thought was a healthy respect for the possibility that this Ukraine rally might fade sooner than later. Gold knocking on the $ 2000 door today (Sunday) at $ 1993. Still have a major NEM position, with a much bigger one in AEM.

Folks, how many share Goldman’s conviction that gold hits $ 2150 this year?
@Miners to the Moon I still have a healthy position in AEM. Gold is 2000 right now. It looks like possibly a parabolic move in metals.
For low volatility, steady as she goes, major.....what a beautiful RIP!!!!!
Thanks Taylor. NEM remains on my watchlist and is a share I've dipped in/out of over the past 5 years or so (shame I didnt keep those bought in 2016 at $36!).
Taylor Dart profile picture
Hi Diottica,

No problem, thanks for reading! It's a nice slow & steady name for those wanting exposure with low volatility, which is why I like it.
Buy at 59? So compelling. A 14% pullback ? Anyone could say 15% lower looks like a good entry point about any stock—-14% is a bit more than a dip. If NEM were to fall that low I’m sure you thesis would change to buy it at 49–because that would mean there was a radical shift in either Fed policy or a worldwide catastrophe. Oh wait—there’s one brewing and NEM can’t even get to 70 yet with every commodity up 10-20% in the last week.
Windham Financial profile picture
@Sane Man IF NEM dropped to $ 59, that would mean it failed to hold a double cup and handle pattern, it broke its uptrend line, has broken below it's 50 and 200-DMA and that commodities were probably in free fall. Under those circumstances, I would probably be running for the hills. On a break below $ 60, you would have to ask yourself, has the narrative changed? The answer would most likely be yes and you would not want to be anywhere near this stock. Last breakout point was at $ 65 and the stock should hold that price on any pullbacks. Current resistance level remains just above the market between $ 69.50 and $ 70. Upper BBAND at $ 70.45. Very little overhead supply above those levels. We remain long from $ 62.25 and own the March $ 60 call options. Investing requires a good strategy and patience.
Taylor Dart profile picture
@Sane Man I stated many times at $54 - $56 is a buy, now Ive upgraded my low risk buy zone to $59. My thesis would not change, the charts looked very ugly last year also with constant bad news, I’m happy to buy into bad news as long as price is right.
swaps profile picture
Excellent article. Thanks.
Taylor Dart profile picture
@swaps Thank you & thanks for reading!
Z Hu profile picture
Way ahead of you, I already have a limit order at $54, though I don't remember where I got that entry point at. Probably read the same chart as you, good to have confirmation.
Windham Financial profile picture
Just buy the stock. Good luck on buying a dip in this environment. NEM picks up $ 100M in cash flow for every $ 100 move in Gold. Do you really believe gold is going down to $ 1,750 - $ 1,800 in the near future? More likely $ 2,000+. Great dividend in a highly volatile market to draw income investors. Disclosre: we are long NEM from $ 62.25 and long the March $ 60 call options.
Taylor Dart profile picture
@Windham Financial I’m long from $54.00, why would I buy at $69.00? The time to buy was three months ago when it was hated, not when it’s 30% off the lows. Also, it’s $400 million in incremental cash flow for every $100/oz move in gold. Still doesn’t make the stock a buy at $69.00. The time to buy cyclical million ounce producers is at 15-16x earnings, not 21x.
Windham Financial profile picture
@Taylor Dart With inflation most likely heading into the 12% - 15% range, you should be just beginning your move in Gold and Silver, even if you remove the geopolitical drivers. Given the increase in cash flow for every $ 100 move in gold and strong dividend growth, this is a very compelling buy at it's current price for the best gold mining company in the industry. You can play this stock from both a value or momentium perspective. Value, wait for the dip (good luck) and momentium, just buy the stock. We're playing it both ways. If you want to wait for a pullback, $ 65 would technically be a more reasonable price. Today, we were adding to our WPM on the breakout. But overall, a very good article.
Taylor Dart profile picture
@Windham Financial Different strategies for different folks, I got most of the gold exposure I wanted in December, and I wouldn’t call a 5% pullback a dip in a miner, that’s a daily swing in many cases. NEM may be the biggest, Im not sure its the best, and at 1.3x P/NAV, hard to call it a compelling buy either up here, at least from
a value standpoint. Good luck with your investments.
StephanJK profile picture
Good article! NEM is an excellent value play and the market BEGINS to realize. Plenty of room to the upside.
Economist 101 profile picture
Spot on. I also agree that $75 is fair value for the stock.

I wish the company would warehouse some of their gold and stop selling it at these artificially rigged prices. Demand whomever buys their gold pay a premium.
bigbenorr profile picture
@lester11 YES! As a shareholder, I approve of this, or pay my dividends in gold.
Economist 101 profile picture
@bigbenorr half an oz of gold for every 1,000 shares or something along those lines would be a game changer.

It just bothers me that I have to pay $2000/oz if I were to buy an oz of gold from Apmex. But NEM is selling their gold wholesale at that fraudulent Comex spot price. NEM is getting totally ripped off. Why aren't they demanding a premium??
bver88 profile picture
someone showed the CEO video of


Dealey Plaza ?

just askin?

why indeed sell under odds?
Thanks. Since I consider gold in any form to be a very long term investment, I would buy this stock below $30-35.
I'll just second Bigbenorr's comment. (except for the "wish I yolo'd everything on it part). Thanks for the work Taylor.
Taylor Dart profile picture
Hi Tman,

Happy it was of value, thanks for reading!
smurf profile picture
Dips? Up to nearly $69 today, as you would expect from a gold miner, considering the world situation. I decided to wait to under $50, which it approached within the past few months.

Snooze = Lose
bigbenorr profile picture
Man, bought quite a bit at 54, but wishing I had just yolo'd everything on it. Its like a solid gold backed bank account with 4% interest.
Taylor Dart profile picture
Hi Bigbenorr,

Great buys at $54.00 and nice discipline to hold. Agreed, a very solid place to park some money sub $60.00.
bigbenorr profile picture
@Taylor Dart I almost couldn't believe it when it touched the 53's, and that was only a few months ago.
@Taylor Dart, how about now in the $ 82’s?
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.