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Newmont (NEM) to Acquire Remaining 5% Stake in Yanacocha for $48M

·3 min read

Newmont Corporation NEM will acquire the remaining 5% interest in Yanacocha from Sumitomo Corporation for $48 million. The deal, which is anticipated to close in the second quarter, will make Newmont the exclusive owner-operator of this world-class asset.

In Feb 2022, Newmont acquired Buenaventura’s 43.65% interest in Minera Yanacocha. The acquisition of the Buenaventura and Sumitomo ownership positions is aligned with Newmont’s district consolidation strategy.

Newmont stated that this transaction provides it full equity ownership of the Yanacocha district where it is positioning the Sulfides project for profitable production and value generation in the coming decades. It is committed to being a catalyst for sustainable development in Peru. The company looks forward to continuing to work closely with communities in the Cajamarca region and the Peruvian government.

Newmont continues to proceed with the Sulfides project, which is rolling toward a full-funds decision later this year. The Sulfides project will boost Newmont’s copper production, support the transition to a green economy and extend mine life in the coming decades.

Shares of Newmont have increased 33.4% in the past year compared with a 9.4% increase of the industry.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Newmont, in its last earnings call, stated that it expects attributable gold production of 6.2 million ounces for 2022. The company also expects gold CAS to be $820 per ounce and AISC to be $1,050 per ounce.

Newmont’s guidance reflects increasing gold production and ongoing investment in its operating assets and most promising growth prospects. It includes current development capital costs and production related to Tanami Expansion 2, Ahafo North, Yanacocha Suldes, Pamour at Porcupine and Cerro Negro District Expansion 1.

Newmont Corporation Price and Consensus

Newmont Corporation Price and Consensus
Newmont Corporation Price and Consensus

Newmont Corporation price-consensus-chart | Newmont Corporation Quote

Zacks Rank & Key Picks

Newmont currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are The Mosaic Company MOS, AdvanSix Inc. ASIX and Allegheny Technologies Incorporated ATI.

Mosaic has a projected earnings growth rate of 131.2% for the current year. The Zacks Consensus Estimate for MOS' current-year earnings has been revised 32.7% upward in the past 60 days.

Mosaic’s earnings beat the Zacks Consensus Estimate in three of the last four quarters while missing once. It delivered a trailing four-quarter earnings surprise of roughly 3.7%, on average. MOS has rallied around 126.4% in a year and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

AdvanSix has a projected earnings growth rate of 64.8% for the current year. The Zacks Consensus Estimate for ASIX’s current-year earnings has been revised 58% upward in the past 60 days.

AdvanSix’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average being 23.6%. ASIX has surged 72.3% in a year. The company sports a Zacks Rank #1.

Allegheny, currently sporting a Zacks Rank #1, has an expected earnings growth rate of 684.6% for the current year. The Zacks Consensus Estimate for ATI's earnings for the current year has been revised 20% upward in the past 60 days.

Allegheny’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 127.2%. ATI has rallied around 22% over a year.


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