Newmont: Average On The Cost Curve, But Above Average Upside Potential (Archive)

This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.

Elevator Pitch

• Ahafo North is starting commercial production, adding around 5% low-cost gold volume versus Newmont’s current run-rate and supporting margin expansion and free cash flow growth.
• Ongoing SG&A and project cost reductions from workforce restructuring and organizational simplification should further improve NEMt’s margins and cash flow conversion.
• Majority control of Nevada Gold Mines could unlock additional operational cost efficiencies on an already key 19.4% gold production and sales contributor for NEM.
• NEM trades close to fair value on 1-year forward P/CFPS, but rising earnings expectations and a correction in the multiple create an attractive setup.
• Technical charts suggest NEM can continue outperforming the S&P 500 until a major resistance level is reached.

Read the full article here.