Section 1: Company Overview and Fundamentals

1.1 Company Overview:

Newmont Corporation (NYSE: NEM) is a gold company and a producer of copper, silver, zinc, and lead. The Company’s portfolio of assets and prospects is anchored in mining jurisdictions in North America, South America, Australia, and Africa.

Kalkine’s Diversified Opportunities Report covers the Company Overview, Key positives & negatives, Investment summary, Key investment metrics, Top 10 shareholding, Business updates and insights into company recent financial results, Key Risks & Outlook, Price performance and technical summary, Target Price, and Recommendation on the stock.

Price Performance:

• NEM's share price has corrected by 14.45% in the past three months. Moreover, in the long term, the stock has corrected by 17.30% over the past six months.

• The stock is in its lower band of its 52-week range of USD 55.41 and 52-week low price of USD 37.45. Post the announcement of Q2FY23 results the stock has corrected by 15.30%, with the current price at a current important support of USD 35.00-USD 38.00.
• The price is currently trading below both its long-term (200-day) SMA and its short-term (50-day) SMA, with the current RSI of 30.09.

      

1.2 The Key Positives, Negatives, and Investment summary

1.3 Top 10 shareholders:

The top 10 shareholders together form ~37.03% of the total shareholding, signifying diverse shareholding. The Vanguard Group, Inc., and BlackRock Institutional Trust Company, N.A. are the biggest shareholders, holding the maximum stake in the company at ~8.79% and ~6.32%, respectively.

1.4 Key Metrics:

NEM has demonstrated a consistent upward trajectory in its revenue and profitability metrics over the past five years. Over the specified period, NEM's revenue showcased a significant growth, advancing from USD 7,253 million in fiscal year 2018 to USD 11,915 million in fiscal year 2022. Similarly, the company's gross profit also exhibited remarkable expansion, ascending from USD 3,160 million in fiscal year 2018 to USD 5,447 million in fiscal year 2022. The company's strategic efforts to enhance revenue and profitability have been evidenced by the remarkable growth observed in the latter years of the five-year period.

1.5 Underlying Commodities Analysis:

Gold remained below the USD 1,900 per ounce mark, lingering at its lowest levels in the past five months. This followed the release of minutes from the latest Federal Open Market Committee (FOMC) meeting, which extended the anticipated timeline for potential interest rate cuts by the Federal Reserve. This situation negatively impacted the demand for gold, as it is perceived as a non-interest-bearing asset. The FOMC members highlighted ongoing inflation risks that might necessitate interest rate hikes. However, certain policymakers expressed uncertainty regarding the time it takes for policy changes to affect the economy, thereby cautioning against excessively tightening measures for the more dovish members of the Committee. In addition, robust economic indicators contributed to the downward pressure on precious metals. The data indicated that industrial production in July exceeded expectations, alleviating concerns about the impact of higher borrowing costs on the sector. This positive economic data provides the FOMC with more flexibility for potential tightening actions.

Section 2: Business Updates and Corporate Business Highlights

2.1 Recent Updates:

The below picture gives an overview of the recent updates:

2.2 Insights of Q2FY23:

Section 3: Key Risks & Outlook

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

Stock Performance:

• NEM's share price has corrected by 14.45% in the past three months. Moreover, in the long term, the stock has corrected by 17.30% over the past six months.

• The stock is in its lower band of its 52-week range of USD 55.41 and 52-week low price of USD 37.45. Post the announcement of Q2FY23 results the stock has corrected by 15.30%, with the current price at a current important support of USD 35.00-USD 38.00.
• The price is currently trading below both its long-term (200-day) SMA and its short-term (50-day) SMA, with the current RSI of 30.09.

4.2 Fundamental Valuation

Valuation Methodology: EV/Sales Multiple Based Relative Valuation

Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is August 16, 2023. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: The report publishing date is as per the Pacific Time Zone.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.

 Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.

 Stop-loss: It is a level to protect against further losses in case of unfavorable movement in the stock prices.