Company Research | Newmont

June 27, 2024by

Today, we’ll talk about Newmont (NEM), which has been one of the top growth stocks over the past 3 months.

Over the past three months, Newmont shares have risen by +22.3%. At the same time, the commodities sector, to which the company belongs, declined by -2.4%, while the S&P 500 index rose by +4.2%. As you can see, Newmont’s shares show better returns than the sector average.

Newmont is one of the world’s largest gold mining companies and also produces copper, silver, zinc, and lead as by-products. The company owns 17 mines in the United States, Africa, Australia, and Papua New Guinea.

The company operates in the metals and other minerals mining industry. It was founded in 1921, listed on the NYSE in 1925, and in 1969 was included in the S&P 500 index. For the past 2 years, the company has been run by Thomas Palmer and a team of experienced managers.

Newmont’s main competitors are Freeport-McMoRan, Nucor and Steel Dynamics. As you can see from the table above, some of them are ahead of the company in terms of capitalization, but it has a number of competitive advantages.

Newmont’s strengths are based on its ability to scale. Over the past 5 years, the company has made 3 major mergers, namely, it acquired competitors Goldcorp, Barrick Gold, and Newcrest. Newmont is also developing mining projects on its own – Tanami Expansion 2 in Australia, Ahafo North in Ghana, and Cerro Negro District Expansion 1 in Argentina. The company estimates that this expansion approach will increase gold production by +23% by 2028.

Newmont published its latest report on April 25. 55% of the revenue structure is occupied by production costs, and 45% by gross profit. Over the past quarter, the company earned a profit of $363M. And its market capitalization is now $49.3B.

*This is not an investment recommendation. It is up to each individual to decide which criteria to favor when making an investment decision, taking into account their goals and individual risk tolerance.
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