J.P. Morgan: Newmont Mining Paving New Path for Gold Companies

In a research report published today, J.P. Morgan claims that Newmont Mining Corp. NEM is pioneering a new path for the major gold companies, regardless of the need for managers to be more selective in their purchases. J.P. Morgan further explained in the report, “This quarter's result has highlighted that managements must now be much more selective (or patient) with their purchases. NEM's Hope Bay write down was just one of three among the majors this quarter. Yet its stock price has held up well, even as it wrestles with what seems to be a politically dominated delay with its Conga development. We feel Newmont's new focus on offering an attractive dividend in a yield starved world is the key. The company's strong cashflows from its established mine assets put it at an advantage and bigger gold prices are extending the lives of existing mines which should protect the dividends while gold prices remain firm.” J.P. Morgan maintains its Overweight rating and $80 PT on Newmont Mining, which closed Friday at $62.51.