The stock of Newmont Corp. (NEM) is down 9% on Oct. 21, just days before the world’s biggest gold miner is set to report its latest financial results.
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NEM stock is crashing alongside the price of gold, which is down 6% on the day amid growing volatility for the precious metal. The pullback in gold’s price comes after it rose more than 60% this year, hitting new all-time highs on more than 30 separate occasions.
Analysts say a pullback in gold was to be expected after such a big rally. Unfortunately, the downturn in bullion is dragging Newmont stock lower as well. However, even with the big drop on Oct. 21, NEM stock is still up 125% this year, having benefited from record high prices for the gold it extracts from the ground.
Upcoming Earnings
The timing of gold’s pullback and drop in Newmont’s stock is bad coming as it does right before the company reports its latest financial results on Oct. 23. Regardless, Newmont is expected to announce strong top and bottom line numbers, driven by the record run in gold’s price.
Wall Street is expecting Newmont to post earnings per share (EPS) of $1.27 for the quarter ended Sept. 30. That would be up 57% from $0.81 per share reported a year earlier. The miner has been easily beating consensus forecasts this year, topping Wall Street’s earnings outlook by 49% in the first quarter and 38% in the second.
Is NEM Stock a Buy?
The stock of Newmont Mining has a consensus Strong Buy among 15 Wall Street analysts. That rating is based on 12 Buy and three Hold recommendations issued in the last three months. The average NEM price target of $91.20 implies 6.24% upside from current levels.
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