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Newmont (NEM) Moves 7.0% Higher: Will This Strength Last?

Newmont Corporation (NEM) shares soared 7% in the last trading session to close at $45.12. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 12.1% loss over the past four weeks.

NEM’s stock popped on a rally in gold prices as the collapse of the Silicon Valley Bank led skittish investors flock to safe-haven assets. The bank failure triggered expectations of less-aggressive Federal Reserve rate hikes and led to the significant weakening of the U.S. dollar, sending the yellow metal’s prices to six-week highs.

This gold and copper miner is expected to post quarterly earnings of $0.33 per share in its upcoming report, which represents a year-over-year change of -52.2%. Revenues are expected to be $2.94 billion, down 2.7% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For Newmont, the consensus EPS estimate for the quarter has been revised 43.6% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on NEM going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Newmont is a member of the Zacks Mining - Miscellaneous industry. One other stock in the same industry, MP Materials Corp. (MP), finished the last trading session 0.1% higher at $29.38. MP has returned -4.7% over the past month.

MP Materials Corp.'s consensus EPS estimate for the upcoming report has changed +22.2% over the past month to $0.18. Compared to the company's year-ago EPS, this represents a change of -64%. MP Materials Corp. currently boasts a Zacks Rank of #3 (Hold).

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