Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of B . The company's strengths can be seen in multiple areas, such as its expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
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Highlights from the ratings report include:
- Despite the weak revenue results, NEM has outperformed against the industry average of 21.2%. Since the same quarter one year prior, revenues slightly dropped by 9.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The gross profit margin for NEWMONT MINING CORP is rather high; currently it is at 52.80%. Regardless of NEM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 14.79% trails the industry average.
- Despite currently having a low debt-to-equity ratio of 0.46, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.94 is weak.
- NEWMONT MINING CORP's earnings per share declined by 17.3% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, NEWMONT MINING CORP reported lower earnings of $1.03 versus $4.62 in the prior year. This year, the market expects an improvement in earnings ($3.70 versus $1.03).
- The change in net income from the same quarter one year ago has significantly exceeded that of the Metals & Mining industry average, but is less than that of the S&P 500. The net income has significantly decreased by 25.6% when compared to the same quarter one year ago, falling from $493.00 million to $367.00 million.
Newmont Mining Corporation, together with its subsidiaries, engages in the acquisition, exploration, and production of gold and copper properties. The company's assets or operations are located in the United States, Australia, Peru, Indonesia, Ghana, New Zealand, and Mexico. Newmont has a market cap of $22.36 billion and is part of the basic materials sector and metals & mining industry. The company has a P/E ratio of 105.8, above the S&P 500 P/E ratio of 17.7. Shares are down 24.2% year to date as of the close of trading on Thursday.
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--Written by a member of TheStreet Ratings Staff.
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