Results: Newmont Corporation Exceeded Expectations And The Consensus Has Updated Its Estimates

Newmont Corporation (NYSE:NEM) just released its quarterly report and things are looking bullish. It was overall a positive result, with revenues beating expectations by 6.3% to hit US$4.4b. Newmont reported statutory earnings per share (EPS) US$0.74, which was a notable 15% above what the analysts had forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Newmont

Following the latest results, Newmont's 15 analysts are now forecasting revenues of US$18.0b in 2024. This would be a sizeable 21% improvement in revenue compared to the last 12 months. Newmont is also expected to turn profitable, with statutory earnings of US$2.49 per share. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$17.8b and earnings per share (EPS) of US$2.60 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

It might be a surprise to learn that the consensus price target was broadly unchanged at US$50.95, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Newmont analyst has a price target of US$61.00 per share, while the most pessimistic values it at US$38.29. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Newmont's past performance and to peers in the same industry. It's clear from the latest estimates that Newmont's rate of growth is expected to accelerate meaningfully, with the forecast 47% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 6.2% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 5.2% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Newmont is expected to grow much faster than its industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at US$50.95, with the latest estimates not enough to have an impact on their price targets.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. At Simply Wall St, we have a full range of analyst estimates for Newmont going out to 2026, and you can see them free on our platform here..

Don't forget that there may still be risks. For instance, we've identified 2 warning signs for Newmont (1 is concerning) you should be aware of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com