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The gold miner surpassed the Zacks Consensus Estimate in two of the trailing four quarters while missed twice. For this timeframe, the company delivered a negative earnings surprise of roughly 1.6%, on average. Newmont posted a negative earnings surprise of 2.8% in the last reported quarter. The company’s second-quarter results are expected to reflect the benefits of higher realized prices and improved grades across a number of mines.
The stock has lost 13.2% in the past year compared with the industry’s 25.6% decline.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
What Do the Estimates Say?
The Zacks Consensus Estimate for second-quarter consolidated revenues for Newmont is currently pegged at $3,089 million, which calls for a rise of around 0.8% year over year.
The Zacks Consensus Estimate for second-quarter average realized prices of gold stands at $1,900, suggesting a 4.2% year-over-year increase and a 0.4% rise on a sequential comparison basis. The same for the attributable gold production is pegged at 1.5 million ounces, indicating a 3.4% year-over-year increase and a 11.6% sequential rise.
Some Factors to Watch For
Improved production performance is expected to have supported the company’s second-quarter results following coronavirus-related disruptions in the first quarter stemming from a surge in Omicron cases. In South America, the Merian mine is likely to continue to have delivered solid performance in the quarter, aided by strong mill performance. Cerro Negro is expected to have delivered improved productivity and grades.
Performance at Penasquito in North America is also likely to remain strong in the second quarter. Musselwhite is also expected to have delivered improved productivity and production. In Australia, performance across Tanami and Boddington mines is likely to have been aided by higher ore grades in the to-be-reported quarter. Strong production across Akyem and Ahafo is also expected to have driven results in the company’s Africa operation in the June quarter.
Meanwhile, gold prices lost the momentum in the June quarter. Gold rallied roughly 8% in the first quarter, thanks to rapidly rising inflation, higher interest rates and uncertainties surrounding the Russia-Ukraine conflict. Amid the economic uncertainties, weakness in equity markets and increased volatility, gold stood out as an effective hedge. However, gold prices erased the gains and closed the second quarter roughly 7% lower. A key reason behind the downswing in prices was the sharp rally in the U.S. dollar.
Nevertheless, higher year-over-year average realized gold prices are expected to have aided Newmont’s performance in the June quarter.
Our proven model does not conclusively predict an earnings beat for Newmont this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Newmont is 0.00%. The Zacks Consensus Estimate for earnings for the second quarter is currently pegged at 62 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Newmont currently carries a Zacks Rank #3 (Hold).
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows these have the right combination of elements to post an earnings beat this quarter:
The Zacks Consensus Estimate for Albemarle's second-quarter earnings has been revised 10.3% upward over the past 60 days. The consensus estimate for ALB’s earnings for the quarter is currently pegged at $2.93.
Celanese Corporation (CE - Free Report) , scheduled to release earnings on Jul 28, has an Earnings ESP of +1.03% and carries a Zacks Rank #3.
The Zacks Consensus Estimate for Celanese’s second-quarter earnings has been revised 3.9% upward over the past 60 days. The Zacks Consensus Estimate for CE’s earnings for the quarter is currently pegged at $4.58.
FMC Corporation (FMC - Free Report) , slated to release earnings on Aug 2, has an Earnings ESP of +0.62% and carries a Zacks Rank #3.
The Zacks Consensus Estimate for FMC’s second-quarter earnings has been stable over the past 60 days. The consensus estimate for FMC’s earnings for the second quarter stands at $1.90.
Image: Bigstock
Newmont (NEM) to Report Q2 Earnings: What's in the Offing?
Newmont Corporation (NEM - Free Report) is scheduled to report second-quarter 2022 results before the opening bell on Jul 25.
The gold miner surpassed the Zacks Consensus Estimate in two of the trailing four quarters while missed twice. For this timeframe, the company delivered a negative earnings surprise of roughly 1.6%, on average. Newmont posted a negative earnings surprise of 2.8% in the last reported quarter. The company’s second-quarter results are expected to reflect the benefits of higher realized prices and improved grades across a number of mines.
The stock has lost 13.2% in the past year compared with the industry’s 25.6% decline.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
What Do the Estimates Say?
The Zacks Consensus Estimate for second-quarter consolidated revenues for Newmont is currently pegged at $3,089 million, which calls for a rise of around 0.8% year over year.
The Zacks Consensus Estimate for second-quarter average realized prices of gold stands at $1,900, suggesting a 4.2% year-over-year increase and a 0.4% rise on a sequential comparison basis. The same for the attributable gold production is pegged at 1.5 million ounces, indicating a 3.4% year-over-year increase and a 11.6% sequential rise.
Some Factors to Watch For
Improved production performance is expected to have supported the company’s second-quarter results following coronavirus-related disruptions in the first quarter stemming from a surge in Omicron cases. In South America, the Merian mine is likely to continue to have delivered solid performance in the quarter, aided by strong mill performance. Cerro Negro is expected to have delivered improved productivity and grades.
Performance at Penasquito in North America is also likely to remain strong in the second quarter. Musselwhite is also expected to have delivered improved productivity and production. In Australia, performance across Tanami and Boddington mines is likely to have been aided by higher ore grades in the to-be-reported quarter. Strong production across Akyem and Ahafo is also expected to have driven results in the company’s Africa operation in the June quarter.
Meanwhile, gold prices lost the momentum in the June quarter. Gold rallied roughly 8% in the first quarter, thanks to rapidly rising inflation, higher interest rates and uncertainties surrounding the Russia-Ukraine conflict. Amid the economic uncertainties, weakness in equity markets and increased volatility, gold stood out as an effective hedge. However, gold prices erased the gains and closed the second quarter roughly 7% lower. A key reason behind the downswing in prices was the sharp rally in the U.S. dollar.
Nevertheless, higher year-over-year average realized gold prices are expected to have aided Newmont’s performance in the June quarter.
Newmont Corporation Price and EPS Surprise
Newmont Corporation price-eps-surprise | Newmont Corporation Quote
Zacks Model
Our proven model does not conclusively predict an earnings beat for Newmont this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Newmont is 0.00%. The Zacks Consensus Estimate for earnings for the second quarter is currently pegged at 62 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Newmont currently carries a Zacks Rank #3 (Hold).
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows these have the right combination of elements to post an earnings beat this quarter:
Albemarle Corporation (ALB - Free Report) , scheduled to release earnings on Aug 3, has an Earnings ESP of +18.98% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Albemarle's second-quarter earnings has been revised 10.3% upward over the past 60 days. The consensus estimate for ALB’s earnings for the quarter is currently pegged at $2.93.
Celanese Corporation (CE - Free Report) , scheduled to release earnings on Jul 28, has an Earnings ESP of +1.03% and carries a Zacks Rank #3.
The Zacks Consensus Estimate for Celanese’s second-quarter earnings has been revised 3.9% upward over the past 60 days. The Zacks Consensus Estimate for CE’s earnings for the quarter is currently pegged at $4.58.
FMC Corporation (FMC - Free Report) , slated to release earnings on Aug 2, has an Earnings ESP of +0.62% and carries a Zacks Rank #3.
The Zacks Consensus Estimate for FMC’s second-quarter earnings has been stable over the past 60 days. The consensus estimate for FMC’s earnings for the second quarter stands at $1.90.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.