Newmont Corporation NEM has received clearance from the Australian Competition & Consumer Commission (ACCC) to proceed with its planned acquisition of Newcrest Mining Limited. The ACCC's approval is a significant step, and the agency is set to forward this decision to Australia's Foreign Investment Review Board for further consideration.
While Newmont continues to pursue other required regulatory endorsements, the company anticipates completing the acquisition in the fourth quarter of this year. Recent approvals include those from Korea's Fair Trade Commission, Papua New Guinea's Independent Consumer & Competition Commission and Canada's Competition Bureau, all of which have given their clearance to the proposed acquisition.
Additional regulatory clearances essential for Newmont's acquisition of Newcrest include those from the Australia Foreign Investment Review Board, the Japan Fair Trade Commission and the Philippine Competition Commission. Newmont and Newcrest are also actively engaging with the Papua New Guinea government and relevant regulators to secure other necessary approvals for the transaction.
On May 14, Newmont revealed its definitive agreement to acquire Newcrest, a move aimed at creating a powerhouse portfolio of assets heavily concentrated in Tier 1 operations within favorable and low-risk mining jurisdictions. Once the acquisition is completed, the merged company will boast a multi-decade production profile comprising of 10 sizable, long-life, cost-efficient Tier 1 operations. It will significantly enhance its annual copper production, primarily from Australia and Canada. The combined entity is projected to yield pre-tax synergies of $500 million annually, expected to be realized within the first two years. It also aims to achieve a minimum of $2 billion within the initial two years post-closure through portfolio optimization.
Newmont’s second-quarter adjusted earnings of 33 cents per share fell from 46 cents in the prior-year quarter and were below the Zacks Consensus Estimate of 39 cents. Revenues came in at $2,683 million, declining 12% year over year and missing the Zacks Consensus Estimate of $2,870.1 million.
Newmont's performance revealed a 17.3% drop in gold production to 1.24 million ounces, below the prior year's 1.5 million ounces. Despite a 7% rise in gold prices to $1,965 per ounce, costs applicable to sales rose 13.1% to $1,054 per ounce due to lower sales volumes. All-in-sustaining costs surged 22.8% to $1,472 per ounce.
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 Carpenter Technology Corporation CRS and Hawkins, Inc. HWKN, both sporting a Zacks Rank #1 (Strong Buy), and Livent Corporation LTHM, carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The earnings estimate for Carpenter Technology’s current year is pegged at $3.36, indicating year-over-year growth of 194%. CRS beat the Zacks Consensus Estimate in all the last four quarters, with the average earnings surprise being 10%. The company’s shares have rallied 58.4% in the past year.
The consensus estimate for HWKN's current year is pegged at $3.40, indicating year-over-year growth of 18.9%. HWKN beat the Zacks Consensus Estimate in all the last four quarters, with the average earnings surprise being 25.6%. The company’s shares have rallied 30.8% in the past year.
The consensus estimate for LTHM’s current year is pegged at $2.12, indicating year-over-year growth of 51.4%. In the past 60 days, LTHM’s current-year earnings estimate has been revised upward by 3.4%. LTHM beat the Zacks Consensus Estimate in all the last four quarters, with the average earnings surprise being 19%.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
See This Stock Now for Free >>Newmont Corporation (NEM) : Free Stock Analysis Report
Carpenter Technology Corporation (CRS) : Free Stock Analysis Report
Hawkins, Inc. (HWKN) : Free Stock Analysis Report
Livent Corporation (LTHM) : Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
