Newmont Mining Corporation
NEM
$123.07
-2.95%
Newmont Corporation is the world's largest gold mining company, operating a diversified portfolio of 11 mines and interests in two joint ventures across the Americas, Africa, Australia, and Papua New Guinea, producing gold along with byproducts including copper, silver, zinc, and lead. The company solidified its industry-leading scale through the acquisitions of Goldcorp in 2019 and Newcrest in November 2023, and it now expects to sell roughly 5.3 million ounces of gold in 2026 from continuing operations after divesting six higher-cost, smaller mines. The current investor narrative centers on whether Newmont can sustain its dramatic earnings momentum amid production declines and cost pressures, with the stock surging 34.5% in August 2026 on the back of a powerful gold rally, central bank buying, and a strategic deal with Barrick. Analysts and investors are debating whether the gold price tailwind and the company's strengthened balance sheet—including a $3.2 billion net cash position—can offset operational challenges and justify the stock's re-rating, with recent coverage highlighting both the opportunity and the execution risk.…
NEM
Newmont Mining Corporation
$123.07
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Investment Opinion: Should I buy NEM Today?
Newmont earns a synthesized rating of Buy, anchored by a consensus analyst recommendation of Buy (mean 1.57) and an average target price of $132.87, implying 4.8% upside. The core thesis is that Newmont's industry-leading scale, fortress balance sheet with $8.811 billion in cash, and exceptional free cash flow of $12.273 billion TTM position it to capitalize on elevated gold prices while returning capital to shareholders. Despite production declines, the company's 47.5% revenue growth and 62.4% gross margin demonstrate strong operational execution and pricing power.
The supporting evidence is compelling: revenue grew 47.5% year-over-year to $7.183 billion in Q1 2026, net margin expanded to 45.4%, and the forward PE of 12.57x is below the S&P 500 average of ~20x. The PEG ratio of 0.125 signals undervaluation relative to growth, and the dividend yield of 1.00% with a conservative payout ratio of 15.6% leaves room for increases. Free cash flow of $12.273 billion TTM comfortably covers capital expenditures and shareholder returns, while the debt-to-equity ratio of 0.169 and current ratio of 2.29 reflect a low-risk financial profile. Compared to peers, Newmont's scale and liquidity justify a premium, but its PE remains moderate.
The biggest risks that could invalidate the thesis are a sharp decline in gold prices, operational setbacks from production declines, and valuation compression if earnings disappoint. The stock would upgrade to a stronger Buy if gold prices sustain above $2,500/oz and production stabilizes, or downgrade to Hold if revenue growth decelerates below 20% or free cash flow falls below $8 billion. Currently, the stock appears fairly valued to slightly undervalued relative to its history and growth prospects, but the modest analyst upside suggests limited near-term appreciation. This is an objective, data-driven assessment, not personalized financial advice.
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NEM 12-Month Price Forecast
Newmont presents a balanced risk/reward profile with a neutral stance. The company's exceptional Q1 2026 results, including 47.5% revenue growth and a 62.4% gross margin, are impressive but largely driven by elevated gold prices, which may not persist. The forward PE of 12.57x and low PEG ratio suggest the stock is undervalued, yet the modest analyst upside of 4.8% and wide target range indicate caution. The fortress balance sheet and $12.273 billion in free cash flow provide a margin of safety, but production declines and cost pressures could erode profitability. I would upgrade to bullish if gold prices sustain above $2,600/oz and production stabilizes, or downgrade to bearish if gold falls below $2,200/oz or free cash flow drops below $8 billion.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Newmont Mining Corporation's 12-month outlook, with a consensus price target around $132.87 and implied upside of +8.0% versus the current price.
Average Target
$132.87
0 analysts
Implied Upside
+8.0%
vs. current price
Analyst Count
—
covering this stock
Price Range
$67 - $170
Analyst target range
Newmont is covered by 21 analysts, with a consensus recommendation of "Buy" and an average target price of $132.87. This implies an upside of approximately 4.8% from the current price of $126.81. The recommendation mean of 1.57 (on a scale where 1 is Strong Buy and 5 is Strong Sell) indicates a bullish tilt, with the majority of analysts rating the stock a Buy or Outperform. Recent institutional ratings show a wave of positive actions: TD Cowen upgraded from Hold to Buy on July 14, 2026, and firms like Scotiabank, B of A Securities, RBC Capital, Jefferies, and UBS have reiterated Buy or Outperform ratings. This consensus suggests that analysts are generally optimistic about Newmont's prospects, driven by the gold rally and the company's strong cash flow generation.
The target price range is wide, from a low of $67.00 to a high of $170.00, representing a spread of over 150% from low to high. The high target of $170.00 likely assumes a sustained gold rally, successful integration of Newcrest, and multiple expansion, while the low target of $67.00 may price in a sharp decline in gold prices, operational setbacks, or a recession scenario. The wide spread signals high uncertainty and divergent views on the gold price outlook and Newmont's operational execution. The estimated EPS average of $8.985 for the current year, with a range of $7.91 to $11.30, further highlights the earnings volatility inherent in the gold mining sector. Overall, the analyst community leans bullish, but the modest upside to the average target suggests that much of the good news may already be priced in.
Bulls vs Bears: NEM Investment Factors
The bull case for Newmont is currently stronger, driven by exceptional revenue growth of 47.5% year-over-year, a 62.4% gross margin, and a fortress balance sheet with $12.273 billion in trailing free cash flow. The stock's low PEG ratio of 0.125 and forward PE of 12.57x suggest it remains undervalued relative to its growth, while analyst consensus is a Buy with a $132.87 target. However, the bear case is not without merit: production declines from divested mines, a modest 4.8% upside to the average target, and technical overextension near the 52-week high pose real risks. The single most important tension is whether gold prices can remain elevated to sustain Newmont's margin expansion, or whether production declines and cost pressures will erode profitability. If gold holds above $2,500/oz, the bull case likely prevails; a sharp correction would quickly validate the bear thesis.
Bullish
- Explosive Revenue and Margin Expansion: Q1 2026 revenue surged 47.5% year-over-year to $7.183 billion, while gross margin expanded to 62.4% from 41.7% a year earlier. Net income more than doubled to $3.262 billion, yielding a 45.4% net margin, demonstrating powerful operating leverage from higher gold prices and Newcrest integration.
- Fortress Balance Sheet and Massive Cash Flow: Newmont holds $8.811 billion in cash with a debt-to-equity ratio of just 0.169 and a current ratio of 2.29. Trailing twelve-month free cash flow reached $12.273 billion, funding $1.895 billion in buybacks and $282 million in dividends in Q1 2026 alone, with a net cash position of $3.2 billion.
- Attractive Valuation with Low PEG: The trailing PE of 15.58x and forward PE of 12.57x are modest for a company with 47.5% revenue growth. The PEG ratio of 0.125 suggests the stock is significantly undervalued relative to its earnings growth, especially compared to the S&P 500's PE of around 20x.
- Strong Analyst Consensus and Momentum: 21 analysts rate the stock a Buy with an average target of $132.87, implying 4.8% upside, and a recommendation mean of 1.57. The stock has outperformed SPY by 43.0 percentage points over one year, reflecting strong momentum and institutional confidence.
Bearish
- Production Declines and Cost Pressures: Newmont expects to sell roughly 5.3 million ounces of gold in 2026 from continuing operations after divesting six higher-cost mines, leading to production declines. Recent news highlights production challenges and cost pressures that could pressure future margins.
- Overextended Technicals Near 52-Week High: The stock trades at $126.81, only 6.3% below its 52-week high of $135.29, after a 26.5% three-month gain. The 1-month gain of 7.6% shows deceleration, and the maximum drawdown of -32.4% over the past year signals vulnerability to sharp reversals.
- Modest Analyst Upside and Wide Target Spread: The average analyst target of $132.87 implies only 4.8% upside, suggesting much of the good news is priced in. The target range spans from $67 to $170, a 150% spread, indicating high uncertainty and divergent views on gold prices and operational execution.
- Gold Price Dependency and Cyclical Earnings: Revenue and margin expansion are heavily tied to elevated gold prices. The estimated EPS range of $7.91 to $11.30 for the current year highlights earnings volatility, and a gold price decline could rapidly reverse the margin gains, as seen in the 15% June 2026 drop.
NEM Technical Analysis
Newmont is in a powerful, sustained uptrend, with the stock up 59.2% over the past year and trading at 126.81, which places it at approximately 85.6% of its 52-week range (low of 76.05, high of 135.29). This positioning near the upper end of the annual range signals strong momentum but also raises the risk of overextension, especially after a 26.5% gain over the past three months. The stock's relative strength versus the S&P 500 is striking: it has outperformed SPY by 43.0 percentage points over one year and by 23.5 percentage points over three months, confirming that Newmont is a clear market leader in this period. However, the 52-week high of 135.29 remains a key resistance level, and the current price is only about 6.3% below that peak, suggesting the stock is in a consolidation phase near its highs.
Short-term momentum remains positive but shows signs of deceleration: the stock is up 7.6% over the past month, which is a slower pace than the 26.5% gain over three months, indicating that the rally may be maturing. The 1-month relative strength versus SPY is +8.7 percentage points, still strong, but the 6-month relative strength is only +0.3 percentage points, revealing that most of the outperformance occurred in the more recent 3-month window. This divergence suggests the stock may be entering a period of consolidation or a temporary pullback after a sharp run-up. The beta of 0.543 indicates that Newmont is significantly less volatile than the broader market—about 46% less volatile than SPY—which is atypical for a gold miner and may reflect the company's large-cap stability and hedging characteristics. Volume of 5.55 million shares is moderate, and the short ratio of 2.1 suggests no significant short-selling pressure.
Key technical support lies near the 52-week low of 76.05, but a more immediate support zone is around the 110–115 area, which corresponds to the June–July consolidation range and the 50-day moving average. A breakdown below 110 would signal a deeper correction and potentially test the 100 level, while a breakout above the 52-week high of 135.29 would confirm a new leg higher and could open the door to the 150+ region. The maximum drawdown of -32.4% over the past year highlights the stock's vulnerability to sharp reversals, despite its low beta. Given the low beta, position sizing can be more aggressive than for a high-beta miner, but the recent parabolic move warrants caution and the use of tight stop-losses.
Beta
0.54
0.54x market volatility
Max Drawdown
-32.4%
Largest decline past year
52-Week Range
$76-$135
Price range past year
Annual Return
+55.3%
Cumulative gain past year
| Period | NEM Return | S&P 500 |
|---|---|---|
| 1m | +4.5% | -2.0% |
| 3m | +13.5% | +1.4% |
| 6m | +15.5% | +15.0% |
| 1y | +55.3% | +15.7% |
| ytd | +21.6% | +11.6% |
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NEM Fundamental Analysis
Newmont's revenue trajectory is exceptionally strong, with Q1 2026 revenue of $7.183 billion representing a 47.5% year-over-year increase from Q1 2025's $4.871 billion. This growth is part of a clear multi-quarter acceleration: revenue rose from $4.871 billion in Q1 2025 to $5.275 billion in Q2 2025, $5.380 billion in Q3 2025, $6.571 billion in Q4 2025, and then $7.183 billion in Q1 2026. The sequential growth has been driven by higher gold prices and the contribution from the Newcrest acquisition, though the company is now facing production declines as it divests higher-cost mines. The revenue segment breakdown shows Gold Dore contributing $4.776 billion and Sales From Concentrate And Other Production contributing $2.531 billion in the most recent quarter, indicating a diversified revenue base. The strong top-line momentum supports the investment case, but the sustainability of this growth depends on gold prices and operational execution.
Profitability has expanded dramatically, with Q1 2026 net income of $3.262 billion and a net margin of 45.4%, up from $1.891 billion and 38.8% in Q1 2025. The gross margin in Q1 2026 was 62.4%, a significant improvement from 41.7% in Q1 2025 and 47.6% in Q2 2025, reflecting higher gold prices and cost containment. Operating margin also surged to 60.6% in Q1 2026 from 38.3% a year earlier. The trailing twelve-month net margin stands at 32.1%, and the operating margin is 46.9%, both exceptionally high for the gold mining industry, where margins are typically more volatile. The company's ability to expand margins while integrating Newcrest and divesting non-core assets demonstrates strong operational execution, though the recent production challenges highlighted in news reports could pressure future margins.
Newmont's balance sheet is fortress-like, with a debt-to-equity ratio of just 0.169 and a current ratio of 2.29, indicating ample liquidity. The company generated $12.273 billion in trailing twelve-month free cash flow, a massive sum that comfortably covers its capital expenditures and dividends. In Q1 2026 alone, operating cash flow was $3.785 billion and free cash flow was $3.144 billion, with $1.895 billion returned to shareholders via buybacks and $282 million via dividends. The ROE of 20.9% and ROA of 15.8% are robust, and the interest coverage ratio of 111.7x (based on Q1 2026 data) underscores the minimal financial risk. With $8.811 billion in cash at the end of Q1 2026 and a net cash position, Newmont has significant financial flexibility to fund growth internally, pursue further divestitures, or return more capital to shareholders.
Quarterly Revenue
$7.2B
2026-03
Revenue YoY Growth
+47.5%
YoY Comparison
Gross Margin
62.4%
Latest Quarter
Free Cash Flow
$12.3B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is NEM Overvalued?
Because Newmont is profitable with positive net income, the PE ratio is the primary valuation metric. The trailing PE is 15.58x, while the forward PE is 12.57x, implying that the market expects earnings to grow by approximately 24% over the next year. This gap between trailing and forward multiples suggests that analysts anticipate continued earnings expansion, likely driven by higher gold prices and the full realization of cost synergies from the Newcrest integration. The PEG ratio of 0.125 is exceptionally low, indicating that the stock is undervalued relative to its expected earnings growth rate, though this metric can be distorted by the cyclical nature of gold mining earnings.
Compared to the broader Basic Materials sector, Newmont's valuation appears mixed. The price-to-book ratio of 3.26x is above the sector average, but the price-to-sales ratio of 5.00x and EV/EBITDA of 7.31x are relatively moderate. The net margin of 32.1% is far superior to the typical materials company, which justifies a premium on earnings-based metrics. However, the dividend yield of 1.00% is below the sector average, and the payout ratio of 15.6% is conservative, suggesting room for dividend increases. Without specific industry average multiples provided, we can infer that Newmont's PE of 15.6x is likely at a discount to the market average (S&P 500 PE around 20x) but at a premium to some gold mining peers, reflecting its size and liquidity advantages.
Historically, Newmont's PE ratio has been highly volatile, ranging from negative values during loss years to over 60x. The current trailing PE of 15.58x is near the lower end of its 5-year range, especially when compared to the 2024 levels where PE exceeded 20x. The price-to-book ratio of 3.26x is also below the 2021 peak of over 2.9x, but above the 2024 lows of 1.43x. This suggests that while the stock has re-rated significantly from its 2024 lows, it is not yet at historical extremes. The forward PE of 12.57x implies that if earnings meet expectations, the stock could still be undervalued relative to its own history, particularly if gold prices remain elevated.
PE
15.6x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 7x~65x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
7.3x
Enterprise Value Multiple
Investment Risk Disclosure
Newmont's financial risks are relatively contained but not negligible. The debt-to-equity ratio of 0.169 and current ratio of 2.29 indicate a strong balance sheet, and the interest coverage ratio of 111.7x underscores minimal financial strain. However, the company faces production declines after divesting six higher-cost mines, with 2026 gold sales expected at 5.3 million ounces from continuing operations. This volume reduction could pressure revenue if gold prices stagnate, and the trailing twelve-month net margin of 32.1% may not be sustainable if cost inflation persists. Additionally, the estimated EPS range of $7.91 to $11.30 for the current year highlights earnings volatility, and any operational setbacks could lead to significant downward revisions.
Market and competitive risks are significant given Newmont's premium valuation and sector dynamics. The stock trades at a price-to-book ratio of 3.26x, above the sector average, and a price-to-sales ratio of 5.00x, which may compress if gold prices decline. The beta of 0.543 suggests lower volatility than the broader market, but the stock has a maximum drawdown of -32.4% over the past year, indicating vulnerability to sharp reversals. Competitive pressures from peers like AngloGold Ashanti, which offers a higher dividend yield and faster growth, could lead to sector rotation. Regulatory headwinds, such as environmental regulations in mining jurisdictions, and macro sensitivity to interest rates and dollar strength also pose threats. Recent news highlights a 15% June 2026 drop due to gold's bear market and rising costs, underscoring the impact of external factors.
The worst-case scenario for Newmont would involve a sharp decline in gold prices, operational failures at key mines, and a broader market downturn. If gold prices fall below $2,000/oz, Newmont's revenue and margins could contract significantly, leading to earnings misses and analyst downgrades. The stock could retest its 52-week low of $76.05, representing a 40% decline from the current price of $126.81. The analyst low target of $67.00 implies an even steeper 47% downside. A combination of production shortfalls, cost overruns, and a strong dollar could trigger this scenario, resulting in a loss of $50 to $60 per share from current levels. Investors should be prepared for such a drawdown, especially given the stock's recent parabolic move.
FAQ
The key risks for NEM are ranked as follows: 1) Gold price risk – a decline below $2,000/oz could slash revenue and margins, potentially driving the stock to its 52-week low of $76.05 (-40%). 2) Operational risk – production declines after divesting six mines and cost pressures could lead to earnings misses, as highlighted by recent news. 3) Valuation risk – the stock trades near its 52-week high of $135.29, and a failure to meet growth expectations could trigger multiple compression. 4) Competitive risk – peers like AngloGold Ashanti offer higher dividend yields and faster growth, potentially diverting investor interest. Each risk is quantifiable: the max drawdown of -32.4% over the past year underscores the potential severity.
Our 12-month forecast for NEM includes three scenarios: Bull Case (30% probability) targets $150-$170, driven by gold above $2,800/oz and EPS of $11.30; Base Case (50% probability) targets $125-$140, assuming gold averages $2,500/oz and EPS meets the $8.985 consensus; Bear Case (20% probability) targets $67-$90, triggered by gold below $2,000/oz and operational setbacks. The base case is most likely, supported by the analyst average target of $132.87 and current valuation multiples. The key assumption is that gold prices remain elevated but stable, allowing Newmont to sustain its margins while managing production declines.
NEM appears fairly valued to slightly undervalued. The trailing PE of 15.58x and forward PE of 12.57x are moderate compared to the S&P 500's ~20x, and the PEG ratio of 0.125 indicates the stock is cheap relative to its earnings growth. The price-to-book ratio of 3.26x is above the sector average, but the price-to-sales ratio of 5.00x and EV/EBITDA of 7.31x are reasonable for a company with a 32.1% net margin. Compared to its own history, the PE is near the lower end of its 5-year range, suggesting the market is not paying a premium. However, the modest analyst upside of 4.8% implies that much of the good news is already priced in, and the valuation is highly dependent on sustained gold prices.
From a risk/reward perspective, NEM is a good buy for investors bullish on gold and seeking value with growth potential. The stock trades at a forward PE of 12.57x, below the S&P 500 average, and has a PEG ratio of 0.125, suggesting undervaluation relative to its 47.5% revenue growth. Analyst consensus is Buy with a $132.87 target, implying 4.8% upside, but the wide target range ($67-$170) reflects uncertainty. The biggest downside risk is a sharp decline in gold prices, which could push the stock toward its 52-week low of $76.05, a 40% drop. For long-term investors with a higher risk tolerance, NEM offers a compelling combination of scale, cash flow, and dividends, but near-term volatility warrants caution.
NEM is suitable for both, but with different strategies. For long-term investors (minimum 3-5 years), the stock offers exposure to gold, a growing dividend (1.00% yield with a 15.6% payout ratio), and strong free cash flow of $12.273 billion TTM, making it a solid core holding in a commodities portfolio. For short-term traders, the stock's beta of 0.543 and recent 34.5% August surge present momentum opportunities, but the max drawdown of -32.4% and technical overextension near the 52-week high warrant tight stop-losses. A suggested minimum holding period is 2-3 years to ride out gold price cycles and benefit from Newcrest integration synergies. Earnings visibility is moderate, with quarterly volatility, so patience is required.