Bull of the Day: Newmont (NEM)

Newmont NEM is one of the world's largest producers of gold with several active mines in Nevada, Peru, Australia, and Ghana.

Analysts have taken a bullish stance on the stock amid a favorable gold backdrop, with the stock currently a Zacks Rank #1 (Strong Buy). In addition, the company resides in the Zacks Mining – Gold industry, which is currently ranked in the top 10%.

Let’s take a closer look at how the company currently stacks up.

NEM Reports Record Q3 Free Cash Flow

Newmont has benefited significantly from the rise in gold. The favorable operating environment has led to robust quarterly results and commentary, with the company exceeding the Zacks Consensus EPS estimate by an average of 40% across its last four releases.  

The average gold price per oz reached $3,539 throughout Newmont’s latest period, melting higher from the $2,518 mark in the same period last year. Free cash flow of $1.6 billion throughout the period reflected a Q3 record.

As shown below, the company’s cash-generating abilities have been a notable boost over recent periods. The amplified cash-generating abilities bring about many positives, such as increased dividends and buybacks.

Bottom Line

A favorable operating environment has led to Newmont’s NEM share surge, benefiting in a big way from elevated gold prices. Its amplified cash-generating abilities have brought many positives, including buybacks.

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This article originally published on Zacks Investment Research (zacks.com).

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