10 Best Materials Stocks to Buy Right Now

3) Newmont Corporation (NYSE:NEM)

Average Upside Potential: 40.1%

Newmont Corporation (NYSE:NEM) is engaged in the production and exploration of gold. The company also explores copper, silver, zinc, and lead.

Wall Street analysts believe that Newmont Corporation (NYSE:NEM)’s asset management strategy should act as a principal tailwind. The recent transactions consist of monetization of the Batu Hijau contingent payments as well as the sale of the Fruta del Norte stream credit facility. As per the experts, the divestment strategy should help the company accelerate deleveraging efforts and enhance cash returns to shareholders. The proceeds should result in share repurchases and debt reduction, potentially strengthening Newmont Corporation (NYSE:NEM)’s financial position.

Newmont Corporation (NYSE:NEM) also announced that it has agreed to sell the Telfer operation, Newmont’s 70% interest in the Havieron gold-copper project as well as other related interests in the Paterson region, all in Australia, to Greatland Gold plc. The company’s growth strategy also consists of leveraging synergies from the Newcrest acquisition and optimizing its portfolio with the help of strategic asset sales. These initiatives, together with operational improvements, should enhance Newmont Corporation (NYSE:NEM)’s competitive position and fuel long-term value creation.

While Newmont Corporation (NYSE:NEM) has been facing headwinds related to higher production costs and a slight reduction in long-term production targets, its focus on strategic divestitures and the successful execution of core projects should help it navigate the tough environment.

Analysts at Raymond James upped their price target on the shares of Newmont Corporation (NYSE:NEM) from $65.00 to $66.00, giving an “Outperform” rating on 25^th October. L1 Capital, an investment management firm, released its Q2 2024 investor letter. Here is what the fund said:

“Newmont Corporation (NYSE:NEM) (Long +18%) shares outperformed as the company released its first quarter results where gold production exceeded consensus estimates. Newmont also sold a non-core gold asset for US$330m. This move is consistent with the company’s strategy to focus on execution at its large, low-cost and high free cash flow generative assets, while divesting smaller operations to simplify the portfolio. We became shareholders of Newmont following the acquisition of Newcrest in October 2023. With the recent share price rally, we exited the position and rotated into other gold equities where we see greater near-term upside potential.”