Newmont Mining Corp

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NEM : NYSE : Basic Materials
$39.93 | %
Today's Range: 39.48 - 41.45
Avg. Daily Volume: 7,805,300
08/26/16 - 4:02 PM ET

Financial Analysis


NEWMONT MINING CORP's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased, representing a decrease to the bottom line. NEWMONT MINING CORP is extremely liquid. Currently, the Quick Ratio is 2.55 which clearly shows the ability to cover any short-term cash needs. The company managed to increase its liquidity from the same period a year ago, despite already having strong liquidity to begin with. This would indicate improved cash flow.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 1.34% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)2038.01908.0
EBITDA ($mil)829.0722.0
EBIT ($mil)490.0420.0
Net Income ($mil)23.072.0


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)2965.03341.0
Total Assets ($mil)24703.025961.0
Total Debt ($mil)5571.06383.0
Equity ($mil)11423.011271.0


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin47.8445.65
EBITDA Margin40.6737.84
Operating Margin24.0422.01
Sales Turnover0.320.29
Return on Assets0.161.86
Return on Equity0.724.32
Debt Q2 FY16 Q2 FY15
Current Ratio3.892.78
Debt/Capital0.330.36
Interest Expense80.091.0
Interest Coverage6.134.62


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)530.6529.06
Div / share0.030.03
EPS0.090.13
Book value / share21.5321.3
Institutional Own % n/a n/a
Avg Daily Volume7765558.08740778.0

Valuation


HOLD. The current P/E ratio indicates a significant discount compared to an average of 322.99 for the Metals & Mining industry and a significant premium compared to the S&P 500 average of 25.13. Conducting a second comparison, its price-to-book ratio of 1.87 indicates a discount versus the S&P 500 average of 2.82 and a premium versus the industry average of 1.85. The price-to-sales ratio is well above the S&P 500 average, but well below the industry average. The valuation analysis reveals that, NEWMONT MINING CORP seems to be trading at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
NEM 286.86 Peers 322.99   NEM 8.95 Peers 13.16

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

NEM is trading at a discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

NEM is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
NEM 19.92 Peers 36.45   NEM 0.78 Peers 0.82

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

NEM is trading at a significant discount to its peers.

 

Average. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

NEM trades at a valuation on par to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
NEM 1.87 Peers 1.85   NEM -85.72 Peers -152.84

Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

NEM is trading at a valuation on par with its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

NEM is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
NEM 2.69 Peers 3.56   NEM 3.61 Peers -11.78

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

NEM is trading at a discount to its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

NEM has a sales growth rate that significantly exceeds its peers.

 

 

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