Will Newmont Mining (NEM) Stock be Affected by This Analyst Action?

NEW YORK (TheStreet) -- Newmont Mining Corp. (NEM) had its 2015 earnings estimates lowered to $1.42 from $1.52 per share at Credit Suisse, with 2016 earnings estimates lowered to $1.18 per share from $1.21.

The firm reiterated coverage with a price target of $30 and an "outperform" rating.

Newmont Mining announced the acquisition of Cripple Creek & Victor on June 9 for $820 million which could add $254 million to NAV (Net Asset Value). 

"We value the asset at $669 million and expect Newmont Mining to increase NAV for Cripple Creek & Victor within the next 18 months, given Newmont Mining's consistent operational track record," Credit Suisse analysts said.

Greenwood Village, Colo.-based Newmont Mining is primarily a gold producer with operations and assets in the U.S., Australia, Peru, Indonesia, Ghana, New Zealand and Mexico.

Shares of Newmont Mining are up 0.33% to $24.03 in early morning trading Tuesday.

Separately, TheStreet Ratings team rates NEWMONT MINING CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate NEWMONT MINING CORP (NEM) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in stock price during the past year and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 17.3%. Since the same quarter one year prior, revenues rose by 11.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • 46.60% is the gross profit margin for NEWMONT MINING CORP which we consider to be strong. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 9.27% trails the industry average.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, NEWMONT MINING CORP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • NEM's debt-to-equity ratio of 0.62 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.11 is sturdy.
  • You can view the full analysis from the report here: NEM Ratings Report

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