Newmont sweetens its payout

Article Excerpt

NEWMONT MINING $63.01 (New York symbol NEM; Shares outstanding: 501.0 million; Market cap: $30.9 billion; TSINetwork Rating: Average; Dividend yield: 1.9%; www.newmont.com) plans to link future dividend hikes to the price of gold: it will raise the quarterly rate by $0.05 a share for each $100-per-ounce rise in its average selling price for gold in the preceding quarter. The company has now enhanced this policy. If gold prices exceed $1,700 an ounce, it will raise the quarterly dividend by an additional $0.025 a share, for a total increase of $0.075 a share. If gold prices rise above $2,000 an ounce, Newmont will raise the dividend by an additional $0.05 a share, for a total increase of $0.10 a share. The company last paid a quarterly dividend of $0.30 a share on September 29, 2011. The implied annual rate of $1.20 yields 1.9%. Gold prices have moved down from their peak of $1,918 an ounce in August 2011 to today’s price of $1,626. Still, this…