newmont mining

NEWMONT MINING CORP. $53 (New York symbol NEM; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 495.1 million; Market cap: $26.2 billion; Price-to-sales ratio: 2.6; Dividend yield: 2.6%; TSINetwork Rating: Average; www.newmont.com) stopped construction of its 51.35%-owned Conga gold/copper mine in Peru in November 2011. The move was in response to protests by local farmers who fear the mine will contaminate water supplies. An independent group is now reviewing the mine’s environmental impact, and should release its report in April 2012. Meanwhile, Newmont has cut 6,000 jobs at Conga. That will lower its losses until it can restart the project. Newmont is a buy.

NEWMONT MINING CORP. $53 (New York symbol NEM; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 495.1 million; Market cap: $26.2 billion; Price-to-sales ratio: 2.6; Dividend yield: 2.6%; TSINetwork Rating: Average; www.newmont.com) stopped construction of its 51.35%-owned Conga gold/copper mine in Peru in November 2011. The move was in response to protests by local farmers who fear the mine will contaminate water supplies.

An independent group is now reviewing the mine’s environmental impact, and should release its report in April 2012. Meanwhile, Newmont has cut 6,000 jobs at Conga. That will lower its losses until it can restart the project.

Newmont is a buy.

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NEWMONT MINING $59.43 (New York symbol NEM; Shares outstanding: 488.2 million; Market cap: $29.0 billion; TSINetwork Rating: Average; Dividend yield: 2.4%; www.newmont.com) operates gold mines in the U.S., Canada, Mexico, Australia, New Zealand, Peru, Indonesia and Ghana. The company’s worldwide diversification, plus its strong cash flow and balance sheet, make it our favourite gold stock for safety-conscious investors. In 2011, Newmont had record cash flow of $3.6 billion, or $7.27 a share, up 12.9% from $3.2 billion, or $6.46 a share, in 2010. The company holds cash of $1.8 billion, or $3.61 a share. Its long-term debt of $3.6 billion is a low 11.7% of market cap....

Candente Copper, $1.03, symbol DNT on Toronto (Shares outstanding: 118.6 million; Market cap: $122.2 million; www.candentecopper.com), is developing the large-scale Canariaco Norte copper/gold/silver deposit in northern Peru. The deposit holds as much as 8.9 billion pounds of copper, 2 million ounces of gold and 53 million ounces of silver. Candente handed out shares of Cobriza Metals (Toronto symbol CZA) to its shareholders in October 2011. Cobriza holds all of Candente’s properties in Peru except for Canariaco Norte. Candente holds cash of $20 million U.S. That’s enough to complete its feasibility study on the financial viability of a mine. If the company decides to go ahead, it will need to find a major partner, because it will cost over $1.6 billion to develop a mine at Canariaco Norte....

NEWMONT MINING CORP. $60 (New York symbol NEM; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 493.1 million; Market cap: $29.6 billion; Price-to-sales ratio: 2.8; Dividend yield: 2.3%; TSINetwork Rating: Average; www.newmont.com) expects its overall copper production will fall to around 160 million pounds in 2012 from 206 million pounds in 2011. That’s because the operators of its 44.56%-owned Batu Hijau open-pit copper mine in Indonesia need time to clear out waste material so they can reach lower depths with higher grades of copper. As well, Newmont expects its copper production costs to jump to between $1.80 and $2.20 per ounce in 2012 from $1.26 in 2011. The company also expects to produce 5.0 million to 5.2 million ounces of gold in 2012, which is comparable to the 5.2 million ounces it produced in 2011. However, due to rising power and labour costs at its Australian mines, its gold-production costs will jump to between $625 and $675 an ounce from $592 in 2011. Newmont’s long-term outlook remains bright. Concerns over European sovereign debt should continue to spur gold prices. Copper prices should also rebound in 2012, as global consumption will probably exceed production....

NEWMONT MINING CORP. $61 (New York symbol NEM; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 494.8 million; Market cap: $30.2 billion; Price-to-sales ratio: 3.3; Dividend yield: 2.3%; TSINetwork Rating: Average; www.newmont.com) is one of the world’s largest gold-mining companies. It has major mines in the U.S., Australia and Peru. Newmont gets about 90% of its revenue from gold. It gets the remaining 10% from copper, zinc and other metals. Most of Newmont’s copper comes from its 27.56% stake in the large Batu Hijau mining complex in Indonesia. Combined with financing arrangements the company has with other Batu Hijau shareholders, Newmont’s economic interest in this mine is effectively 44.56%. The company prefers to sell its gold at the market price instead of through long-term hedging contracts that lock in prices. This policy has helped it take full advantage of rising gold prices: Newmont’s average realized gold price jumped 105.7%, from $594 an ounce in 2006 to $1,222 in 2010....

NEWMONT MINING CORP. $60 (New York symbol NEM; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 493.1 million; Market cap: $29.6 billion; Price-to-sales ratio: 2.8; Dividend yield: 2.3%; TSINetwork Rating: Average; www.newmont.com) expects its overall copper production will fall to around 160 million pounds in 2012 from 206 million pounds in 2011. That’s because the operators of its 44.56%-owned Batu Hijau open-pit copper mine in Indonesia need time to clear out waste material so they can reach lower depths with higher grades of copper. As well, Newmont expects its copper production costs to jump to between $1.80 and $2.20 per ounce in 2012 from $1.26 in 2011.

The company also expects to produce 5.0 million to 5.2 million ounces of gold in 2012, which is comparable to the 5.2 million ounces it produced in 2011. However, due to rising power and labour costs at its Australian mines, its gold-production costs will jump to between $625 and $675 an ounce from $592 in 2011.

Newmont’s long-term outlook remains bright. Concerns over European sovereign debt should continue to spur gold prices. Copper prices should also rebound in 2012, as global consumption will probably exceed production.

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Gold prices have moved down from their peak of $1,918 an ounce in August 2011 to today’s price of $1,595. Gold could move higher in the long term, but it will remain volatile. In addition, a deeper drop is by no means out of the question. We continue to recommend that you focus your gold investing on gold-mining stocks and avoid buying gold bullion, gold coins (unless you collect them as a hobby) or certificates representing an interest in bullion. That’s because these investments have hidden costs, such as insurance and storage, that dramatically cut their value over time. Newmont remains our top choice among gold stocks. Most of its production comes from politically stable areas, such as North America and Australia. As well, its new dividend policy gives investors an opportunity to automatically profit when gold prices rise....

NEWMONT MINING CORP. $61 (New York symbol NEM; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 494.8 million; Market cap: $30.2 billion; Price-to-sales ratio: 3.3; Dividend yield: 2.3%; TSINetwork Rating: Average; www.newmont.com) is one of the world’s largest gold-mining companies. It has major mines in the U.S., Australia and Peru.

Newmont gets about 90% of its revenue from gold. It gets the remaining 10% from copper, zinc and other metals. Most of Newmont’s copper comes from its 27.56% stake in the large Batu Hijau mining complex in Indonesia. Combined with financing arrangements the company has with other Batu Hijau shareholders, Newmont’s economic interest in this mine is effectively 44.56%.

The company prefers to sell its gold at the market price instead of through long-term hedging contracts that lock in prices. This policy has helped it take full advantage of rising gold prices: Newmont’s average realized gold price jumped 105.7%, from $594 an ounce in 2006 to $1,222 in 2010.

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LIMITED BRANDS INC., $42.61, New York symbol LTD, rose 11% this week, mainly because the company will pay a special dividend of $2.00 a share on December 23, 2011. That’s in addition to its regular quarterly dividend of $0.20 a share, for a 1.9% annualized yield. Limited Brands owns the Victoria’s Secret lingerie chain and the Bath & Body Works personal-care products stores. It also owns the La Senza lingerie chain in Canada. The company also reported that its sales fell 2.3% in November 2011, to $872.6 million from $893.0 million in November 2010. However, that’s mainly because the company recently sold 51% of a business that buys apparel from various manufacturers. On a same-store basis, sales rose 7% during the month....