Why Gold Miner Newmont Shares Are Surging Today
Portfolio Pulse from Lekha Gupta
Newmont Corporation (NYSE:NEM) shares surged after reporting first-quarter FY24 results with revenue of $4.023 billion, surpassing the consensus of $3.670 billion. Gold production decreased by 4% Y/Y to 1.675 million ounces, with a noted decline in output at Tanami due to planned mill shutdown and seasonal rainfall, as well as ongoing stripping campaigns at Boddington and Akyem. Adjusted EBITDA increased by 23% Q/Q to $1.694 billion, and adjusted EPS was $0.55, beating the consensus of $0.36. The company declared a dividend of $0.25 for Q1 FY24 and reaffirmed its FY24 gold production outlook of around 6.9 million ounces with an AISC of $1,400 per ounce. Newmont also expects to spend $1.7 billion-$1.8 billion on Tanami Expansion 2, with commercial production expected in the second half of 2027, and is on track to deliver $500 million in synergies from the Newcrest transaction by the end of 2025. Investors can gain exposure to Newmont through the iShares MSCI Global Gold Miners ETF (NASDAQ:RING) and VanEck Gold Miners ETF (NYSE:GDX).
April 25, 2024 | 4:38 pm
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POSITIVE IMPACT
The VanEck Gold Miners ETF, which includes Newmont Corporation, may experience a positive impact due to Newmont's impressive Q1 FY24 results.
As GDX includes Newmont among its holdings, the ETF is likely to benefit from the positive sentiment surrounding Newmont's recent earnings beat, dividend declaration, and reaffirmed outlook. This positive news could lead to increased investor interest in GDX, potentially boosting its price in the short term.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
Newmont Corporation reported strong Q1 FY24 results with higher than expected revenue and earnings, declared a dividend, and reaffirmed its FY24 outlook.
The positive earnings report, surpassing revenue and EPS expectations, along with a dividend declaration and a reaffirmed optimistic outlook for FY24, are strong indicators of Newmont's financial health and operational success. These factors are likely to instill confidence in investors, potentially driving up the stock price in the short term.
CONFIDENCE 95
IMPORTANCE 90
RELEVANCE 100
POSITIVE IMPACT
Investors can gain exposure to Newmont Corporation through the iShares MSCI Global Gold Miners ETF, which may see increased interest following Newmont's strong Q1 FY24 performance.
Given that RING provides exposure to global gold miners including Newmont, the strong performance and positive outlook of Newmont are likely to attract more investors to RING as a means to indirectly benefit from Newmont's success. This could lead to an increase in RING's price in the short term.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70