The Newcrest Mining Ltd (ASX: NCM) share price closed the day just over 1% in the green on Wednesday, closing out a positive run over the previous 5 days of trading.
Zooming out over wider time frames, we see it wasn't the greatest year for the gold mining giant's share price. It's bounced off a low three times in the past 12 months but failed to recover to former highs on each occasion.
Most recently it has tested the $25 per share mark a couple of times but investors didn't throw support behind the company at that level.
However, investors are buying the most recent dip and have pushed the Newcrest Mining share price to $24.29 at the time of writing.
The price of gold hasn't fared much better in this time either, with the yellow metal now trending down almost 5% since December 2020. For most of the year, it has averaged a sideways trend and failed to break the US$1,800/t.oz mark on several occasions.
With these points in mind, we've gone to what analysts at leading investment banks are saying on the outlook for Newcrest investors in 2022.
What's the outlook for Newcrest in 2022?
Despite the run down in the Newcrest Mining share price in 2021, the analyst teams at leading investment firms are all keeping a very close eye on the company as we roll on into the new year.
For instance, Jefferies, JP Morgan, Scotiabank, Morgan Stanley, Credit Suisse, Goldman Sachs, and Morgans reckon Newcrest has more headroom to grow in 2022.
In a list provided by Bloomberg Intelligence, almost 65% of the analysts covering Newcrest have it as a buy, with the consensus price target sitting at $29.16.
Not a bad signal of upside potential for a stock that was beaten down and overlooked by the market in 2021.
Macquarie Group Ltd (ASX: MQG) is heavily bullish and has Newcrest to strongly outperform. The investment bank reckons investors will benefit from exposure to gold prices coming into FY23 and FY24, as the gold miner's Lihir mine in Papua New Guinea gains steam.
The firm estimates that every 10% increase in the price of gold will garner a 32% increase in Newcrest's earnings in the coming years.
Furthermore, Macquarie sees these gains next to a 20% gain in net present value (NPV) on the site, which bodes well for the company's valuation.
In a recent note, Macquarie said Newcrest "offers leverage to copper prices, and a 10% increase in copper price translates to a 9% earnings upside and 10% valuation improvement".
The New South Wales Government also recently approved plans to increase capacity at Newcrest's Cadia Valley gold mine to 35 million tonnes of ore each year. That's up from 32 million tonnes previously.
Macquarie values Newcrest at $34 per share. Additionally, Barrenjoey, Credit Suisse, and Goldman Sachs have assigned price targets of $33, $31, and $30.50 respectively.
Gauging this list it appears sentiment on the Newcrest Mining share price is bullish heading into the new year.
Newcrest Mining share price summary
Newcrest shares have posted a loss of 6% since the start of 2021. In the past month, they have levelled off and are trading less than 1% in the green after climbing again this week.
Over these longer time frames, Newcrest has lagged the benchmark S&P/ASX 200 index (ASX: XJO)'s return.
