Newmont Mining Corporation
NEM
$108.44
+2.50%
Newmont Corporation is the world's largest gold mining company, with a global portfolio of 11 mines and joint ventures across the Americas, Africa, Australia, and Papua New Guinea. As the definitive industry leader and consolidator, it has grown through major acquisitions like Goldcorp and Newcrest, establishing a dominant scale and reserve base. The current investor narrative is dominated by the volatile interplay between soaring gold prices, which drove blowout earnings and a massive $6 billion buyback in April, and the recent sharp downturn in gold, which has plunged the metal into a bear market and created a perfect storm of falling prices, lower forecasted 2026 production, and rising costs, pressuring the stock.…
NEM
Newmont Mining Corporation
$108.44
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Investment Opinion: Should I buy NEM Today?
Rating & Thesis: Hold. Newmont is a high-quality operator caught in a severe commodity downdraft; investors should wait for gold price stability or further valuation compression before building a position. The consensus analyst view is bullish, but the recent price action and gold market regime shift warrant caution.
Supporting Evidence: The valuation is mixed: the forward P/E of 8.80x is low, but the trailing P/E of 15.59x has been compressing. Profitability is strong with a 58.76% gross margin and a 20.92% ROE. The $10.33B in TTM FCF and the $6B buyback program demonstrate shareholder-friendly capital allocation. However, the stock's -15.74% 1-month return and breakdown below key support at $92.77 indicate powerful selling pressure that overshadows these fundamentals.
Risks & Conditions: The two biggest risks are 1) a continued decline in gold prices, and 2) failure to achieve cost and production targets post-Newcrest integration. This Hold rating would upgrade to a Buy if the forward P/E falls below 7x (implying deeper pessimism) or if gold prices show sustained recovery above key technical levels. It would downgrade to a Sell if the stock breaks below its recent low of $92.77 on high volume, confirming the downtrend. Relative to its own history and the current gold price environment, the stock is transitioning from overvalued to fairly valued, but not yet clearly undervalued.
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NEM 12-Month Price Forecast
The outlook is bifurcated and hinges almost entirely on the path of gold prices. The company's operational and financial strengths are undeniable, but they are currently being overwhelmed by the commodity cycle. The base case (50% probability) sees range-bound trading as the market digests the new gold price regime and assesses Newmont's execution. The bull case requires a gold rally and flawless execution, while the bear case is a continuation of recent trends. The stance would upgrade to bullish on evidence of gold price stabilization above key technical levels and downgrade to bearish on a confirmed breakdown below $92.77.
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 $140.97 and implied upside of +30.0% versus the current price.
Average Target
$140.97
15 analysts
Implied Upside
+30.0%
vs. current price
Analyst Count
15
covering this stock
Price Range
$87 - $141
Analyst target range
The stock is covered by 15 analysts, indicating substantial institutional interest. The consensus recommendation is bullish, as evidenced by recent actions from firms like UBS (Buy), Scotiabank (Sector Outperform), and Bernstein (upgrade to Market Outperform). The average target price is derived from estimated EPS of $9.27 and estimated revenue of $25.86 billion, though a specific consensus price target is not provided in the data; the implied valuation based on forward estimates suggests the market has high earnings expectations. The target range is wide, with estimated EPS spanning from a low of $8.15 to a high of $10.87, and revenue estimates from $23.46 billion to $29.28 billion. This spread signals significant uncertainty among analysts regarding future gold prices, production costs, and the successful integration of the Newcrest assets. The high-end targets likely assume sustained high gold prices and flawless execution on synergies, while the low-end targets may factor in a gold price retreat and operational challenges. The recent institutional ratings show a pattern of reiterated Buy or Outperform ratings, with one notable upgrade from Bernstein in February 2026, indicating generally supportive analyst sentiment despite recent stock price weakness.
Bulls vs Bears: NEM Investment Factors
The investment debate for Newmont is a classic tug-of-war between formidable company-specific strengths and overwhelming commodity price dependency. The bull case is anchored in exceptional financials: massive $10.33B FCF, expanding 58.76% gross margins, a fortress balance sheet (D/E 0.17), and a cheap forward P/E of 8.80x. The bear case is dominated by external forces: the stock's 15.74% monthly plunge directly mirrors gold's bear market, with recent news highlighting a 'perfect storm' of falling prices and rising costs. Currently, the bearish evidence holds stronger sway due to the decisive negative price momentum and the fundamental shift in the gold price regime. The single most important tension is whether the company's low-cost, cash-generating operations can offset a sustained downturn in gold prices. If gold stabilizes or rebounds, the current valuation looks compelling; if the bear market deepens, even Newmont's strengths may not prevent further earnings and multiple compression.
Bullish
- Massive Free Cash Flow Generation: Newmont generated $10.33 billion in trailing twelve-month free cash flow, providing immense financial flexibility. This cash underpins the $6 billion share buyback announced in April and a strong dividend, directly returning capital to shareholders.
- Strong Profitability & Margin Expansion: Q4 2025 gross margin reached 58.76%, a significant expansion from 44.69% in Q4 2024. This demonstrates powerful operating leverage to higher gold prices, with net income of $1.30 billion in the quarter.
- Robust Balance Sheet & Low Debt: The company has a low debt-to-equity ratio of 0.17 and a healthy current ratio of 2.29. This strong financial position provides resilience against commodity price volatility and funds growth without excessive leverage.
- Attractive Forward Valuation: The forward P/E of 8.80x, based on estimated EPS of $9.27, appears low for the world's largest gold miner. This valuation offers a significant discount to the trailing P/E of 15.59x, pricing in substantial earnings growth.
Bearish
- Acute Sensitivity to Falling Gold Prices: The stock has plunged 15.74% in the past month, starkly underperforming the S&P 500 (-0.08%), as gold entered a bear market. Recent news highlights a 'perfect storm' of falling prices, lower 2026 production forecasts, and rising costs pressuring profits.
- Valuation De-Rating Amid Gold Weakness: The trailing P/E has compressed from 21.22x at the end of Q4 2025 to 15.59x currently, indicating a market de-rating. If gold prices remain depressed, the forward P/E of 8.80x may not be sustainable, risking further multiple contraction.
- Volatile Revenue & Earnings Trajectory: While Q4 2025 revenue grew 14.8% YoY, the quarterly sequence shows volatile growth entirely tied to gold prices. Analyst EPS estimates range widely from $8.15 to $10.87, reflecting high uncertainty about future gold prices and operational execution.
- Recent Severe Technical Breakdown: The stock recently broke below the June low of $92.77, signaling a continuation of bearish momentum. Trading at 56% of its 52-week range ($55.37 to $134.88), it has retreated significantly from its highs, indicating a potential trend reversal.
NEM Technical Analysis
The stock is in a volatile downtrend from its recent highs, having declined 15.74% over the past month and 8.53% over the past three months, which sharply contrasts with its strong 79.24% gain over the past year. Currently trading at $100.23, the price sits at approximately 56% of its 52-week range ($55.37 to $134.88), indicating a significant retreat from the highs and positioning it in a middle-ground that reflects both the prior year's massive rally and the recent severe correction. The recent momentum is decisively negative and diverging from the longer-term uptrend, signaling a potential trend reversal or a deep correction driven by the sharp decline in gold prices, as evidenced by the stock's 1-month relative strength of -15.66% versus the S&P 500's -0.08% decline. Key technical support is anchored at the 52-week low of $55.37, while immediate overhead resistance is at the recent peak of $134.88. A breakdown below the recent June low of $92.77 could signal a continuation of the bearish momentum towards deeper support levels, whereas a recovery above the $120-$125 zone would be needed to suggest the correction has ended. The stock's beta of 0.455 indicates it is less volatile than the broader market, which is typical for a large-cap commodity producer, but the recent price action shows it is highly sensitive to swings in the underlying gold price, requiring careful risk management despite the low beta reading. The stock's 1-month price change of -15.74% starkly underperforms the S&P 500's -0.08%, highlighting its acute sensitivity to commodity price moves. The 3-month relative strength of -20.53% further confirms this severe underperformance. The recent price data shows a sharp drop from above $120 in early May to below $100 in June, with volume averaging 7.7 million shares, suggesting the sell-off has been accompanied by significant trading activity.
Beta
0.46
0.46x market volatility
Max Drawdown
-29.7%
Largest decline past year
52-Week Range
$55-$135
Price range past year
Annual Return
+86.6%
Cumulative gain past year
| Period | NEM Return | S&P 500 |
|---|---|---|
| 1m | -0.6% | +1.5% |
| 3m | +1.8% | +13.4% |
| 6m | +9.2% | +10.9% |
| 1y | +86.6% | +24.5% |
| ytd | +7.1% | +10.0% |
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NEM Fundamental Analysis
Revenue growth has been robust but is showing signs of deceleration from peak levels; the most recent Q4 2025 revenue was $6.57 billion, representing a 14.8% year-over-year increase. However, examining the quarterly sequence from Q1 2025 ($4.87B) to Q4 2025 ($6.57B) shows revenue generally climbing, but the growth rate is volatile and tied to gold prices. The revenue segment data shows Gold Dore sales of $7.59 billion and Sales From Concentrate of $4.24 billion, indicating the core gold business is the primary driver, though byproduct metals contribute meaningfully. The company is highly profitable, with Q4 2025 net income of $1.30 billion and a gross margin of 58.76%. Profitability has improved dramatically from the year-ago period (Q4 2024 net income of $1.40 billion on a gross margin of 44.69%), indicating significant margin expansion driven by higher realized gold prices. The trailing twelve-month free cash flow is a substantial $10.33 billion, demonstrating the immense cash-generating power of the business at current gold price levels. The balance sheet is strong, with a low debt-to-equity ratio of 0.17 and a healthy current ratio of 2.29, indicating ample liquidity. The return on equity of 20.92% is solid, reflecting efficient use of shareholder capital. The massive $10.33 billion in TTM free cash flow provides significant internal funding for growth, dividends, and the announced $6 billion share buyback, reducing reliance on external financing and underscoring the company's financial resilience.
Quarterly Revenue
$6.6B
2025-12
Revenue YoY Growth
+0.14%
YoY Comparison
Gross Margin
+0.58%
Latest Quarter
Free Cash Flow
$10.3B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is NEM Overvalued?
Given the positive net income, the primary valuation metric is the P/E ratio. The trailing P/E is 15.59x, while the forward P/E is 8.80x, based on estimated EPS of $9.27. The significant gap between trailing and forward multiples implies the market expects a substantial increase in earnings, likely pricing in sustained higher gold prices and the benefits of the Newcrest integration, though recent gold price weakness may challenge these expectations. Compared to sector averages, Newmont's trailing P/E of 15.59x and Price/Sales of 5.00x are not directly comparable without a provided industry benchmark, but the company's scale and margin profile typically command a premium among gold miners. The forward P/E of 8.80x appears low for a company of its caliber, potentially reflecting market concerns about gold price sustainability or operational execution risks post-acquisition. Historically, the stock's own trailing P/E has fluctuated widely, from deeply negative figures during loss-making periods to over 60x during trough profitability. The current P/E of 15.59x is below the 21.22x seen at the end of Q4 2025, suggesting a de-rating has already occurred. This places the valuation in the middle of its own historical range, indicating the market is balancing the company's strong cash generation against the cyclical risks inherent in the gold mining sector.
PE
15.6x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range -268x~3615x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
7.3x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Newmont's primary financial risk is its absolute dependence on the gold price, which has recently plunged 25% into a bear market. While the company has strong margins (58.76% gross margin in Q4) and low debt (D/E 0.17), a sustained decline in gold prices would directly compress profitability, as seen in the wide analyst EPS estimate range of $8.15 to $10.87. Operational risks include the successful integration of the Newcrest acquisition and managing forecasted lower production in 2026, which could strain the revenue growth trajectory that showed 14.8% YoY increase in Q4.
Market & Competitive Risks: The stock faces significant valuation compression risk, having already de-rated from a P/E of 21.22x to 15.59x. If gold weakness persists, the forward P/E of 8.80x may expand if earnings estimates are cut, rather than contract further. Macro risks are heightened, with recent news highlighting stagflation fears from oil spikes and a hawkish Fed, which can create a toxic environment for gold miners despite their inflation-hedge narrative. The stock's low beta of 0.455 offers little protection against these sector-specific headwinds.
Worst-Case Scenario: The worst-case scenario involves a prolonged gold bear market coupled with execution missteps post-Newcrest integration and rising cost inflation. This could trigger a wave of analyst downgrades, driving EPS estimates toward the low end ($8.15) and compressing the P/E multiple toward historical trough levels. A realistic downside could see the stock re-test its 52-week low of $55.37, representing a potential loss of approximately -45% from the current price of $100.23. The recent 29.69% max drawdown demonstrates the stock's vulnerability to such a sharp correction.
FAQ
The key risks are, in order of severity: 1) Commodity Price Risk: NEM's profits are directly tied to gold, which just fell 25% into a bear market. 2) Operational & Execution Risk: Integrating the Newcrest acquisition and meeting 2026 production targets of ~5.3M ounces amid rising costs. 3) Valuation/Multiple Risk: The trailing P/E has already compressed, and further gold weakness could lead to more de-rating. 4) Macro Risk: Stagflationary environments (high oil, hawkish Fed) can negatively impact gold miners despite their inflation-hedge narrative.
The 12-month forecast presents three scenarios. The Base Case (50% probability) sees the stock trading between $100 and $120, assuming gold prices stabilize and Newmont executes on plan. The Bull Case (30% probability) targets $134 to $145 on a gold price recovery and strong earnings. The Bear Case (20% probability) warns of a drop to $55-$85 if the gold bear market deepens and operational issues arise. The most likely outcome is the Base Case, hinging on the assumption that gold prices do not continue their recent freefall.
NEM's valuation is in transition. The forward P/E of 8.80x appears cheap and suggests the market expects significant earnings growth (EPS est. $9.27). However, the trailing P/E of 15.59x has compressed from 21.22x, indicating a de-rating is already underway. Compared to its own history, the stock is moving from overvalued to fairly valued. The market is currently pricing in a scenario of sustained lower gold prices and successful execution on Newcrest synergies. If gold falls further, the stock could become undervalued; if gold rallies, it currently looks fairly valued.
NEM is a Hold, not a clear buy at current levels. For investors with a high conviction that gold prices will rebound, the forward P/E of 8.80x and the massive $10.33B free cash flow generation present a compelling case. However, given the stock's 15.74% plunge in the past month directly tied to gold's bear market, the timing is risky. It could be a good buy for patient, long-term investors willing to average in on further weakness, but tactical investors should wait for confirmation of gold price stability.
NEM is primarily suitable for long-term investors (3-5 year horizon) who can weather the extreme volatility of the gold cycle. Its low beta of 0.455 and shareholder return policy (dividend yield 1.0%, $6B buyback) support a long-term hold. It is poorly suited for short-term trading due to its acute sensitivity to daily gold price moves, as evidenced by the 29.69% max drawdown. A minimum holding period of 18-24 months is suggested to potentially realize the value from its low-cost operations and capital return program across a full commodity cycle.