Scotiabank Downgrades Newmont Outlook Amid Revenue Decline

In a recent report, Scotiabank adjusted its outlook for Newmont from 'Sector Outperform' to 'Sector Perform'. The report highlights a decrease in projected annual revenue, indicating challenges ahead for the company despite a positive analyst price forecast.

Date: 27-10-2024

AI Rating: 5

The report states that Scotiabank has downgraded Newmont's outlook, which could negatively affect investor sentiment and subsequently the stock price. A downgrade from 'Sector Outperform' to 'Sector Perform' often suggests that analysts anticipate lesser future performance compared to peers.

The average one-year price target for Newmont is noted to be €57.17/share, which represents a potential upside of 25.81% from its recent closing price of €45.44/share. This indication of growth could attract some investors looking for gains, despite the downgrade.

Significantly, the projected annual revenue for Newmont is expected to fall by 27.21%, which raises concerns about the company's financial health and its ability to generate profits in the future. Such a large drop in revenue could lead to a negative impact on various financial metrics, and if actual results deviate from projections, it might raise the risks for investors.

The report also mentions an estimated non-GAAP EPS of 2.41, but it does not provide a comparison to previous figures or the expected change, making it challenging to assess the overall impact on profitability and investor expectations.

It is worth noting that institutional investor sentiment appears to remain positive, as there is an increase in the number of funds reporting positions in Newmont by 34 in the last quarter. The total shares owned by institutions has also risen by 4.61% to 930,250K shares, which indicates some level of confidence amidst the downgrade. However, it is crucial for investors to monitor how these factors may influence stock performance going forward.

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