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Newmont Shares Rally 85% YTD: How Should You Play the Stock?
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Key Takeaways
Newmont stock has soared 85.4% YTD, outpacing the industry and the broader market.
NEM completed the 2025 divestiture program, boosting cash for growth, buybacks and debt cuts.
Liquidity of $10.2B and $1.7B free cash flow support dividends and share repurchases.
Newmont Corporation’s (NEM - Free Report) shares have surged 85.4% so far this year, thanks to the gold price rally resulting from trade and geopolitical uncertainties and its forecast-topping earnings performance underscoring its operational efficiency and the strength of its Tier 1 portfolio. NEM stock has outperformed the Zacks Mining – Gold industry’s 72.2% rise and the S&P 500’s increase of 9.6%. Among its gold mining peers, Barrick Mining Corporation (B - Free Report) , Agnico Eagle Mines Limited (AEM - Free Report) and Kinross Gold Corporation (KGC - Free Report) have rallied 56.5%, 70.7% and 109.1%, respectively, over the same period.
NEM’s YTD Price Performance
Image Source: Zacks Investment Research
Technical indicators for NEM show bullish momentum. NEM eclipsed its 50-day simple moving average (SMA) on May 19, 2025. The NEM stock is also currently trading above its 200-day SMA, suggesting a long-term uptrend. The 50-day SMA is also reading higher than the 200-day SMA, following a golden crossover on April 16, 2025, indicating a bullish trend.
NEM Stock Trades Above 50-Day SMA
Image Source: Zacks Investment Research
Is the time right to buy NEM’s shares for potential upside? Let’s take a look at the stock’s fundamentals.
Key Projects & Asset Streamlining to Drive NEM’s Growth
Newmont continues to invest in growth projects in a calculated manner. The company is pursuing several projects, including Tanami Expansion 2 in Australia, the Ahafo North expansion in Ghana and Cadia Panel Caves in Australia. These projects should expand production capacity and extend mine life, driving revenues and profits.
The acquisition of Newcrest Mining Limited has also created an industry-leading portfolio with a multi-decade gold and copper production profile in the most favorable mining jurisdictions globally. The combination of Newmont and Newcrest is expected to deliver significant value for its shareholders and generate meaningful synergies. NEM has achieved $500 million in annual run-rate synergies, following the Newcrest buyout.
Newmont has also divested non-core businesses as it shifts its strategic focus to Tier 1 assets. NEM completed its non-core divestiture program in April 2025 with the sale of its Akyem operation in Ghana and its Porcupine operation in Canada. NEM has executed agreements to sell its shares in Greatland Resources Limited and Discovery Silver Corp, for total cash proceeds of around $470 million after taxes and commissions. Following the sale of these shares, the company anticipates generating $3 billion in after-tax cash proceeds from its 2025 divestiture program. These funds will support Newmont’s capital allocation strategy, which focuses on reinforcing its balance sheet and delivering returns to its shareholders.
Robust Financial Health Supports NEM’s Capital Allocation
Newmont has a strong liquidity position and generates substantial cash flows, which allow it to fund its growth projects, meet short-term debt obligations and drive shareholder value. At the end of the second quarter of 2025, Newmont had robust liquidity of $10.2 billion, including cash and cash equivalents of around $6.2 billion. Its free cash flow surged nearly threefold year over year and 42% from the prior quarter to $1.7 billion, led by an increase in net cash from operating activities and lower capital investment. Net cash from operating activities shot up 17% from the prior quarter to $2.4 billion. NEM delivered roughly $2 billion to its shareholders through dividends and share repurchases, and reduced debt by $1.4 billion since the beginning of 2025. Newmont’s board has also authorized an additional $3 billion share repurchase program. Its long-term debt-to-capitalization is around 18.8%.
Newmont stands to benefit from the strength in gold prices, which should drive its profitability and cash flow generation. Gold prices have rallied roughly 27% this year, largely attributable to aggressive trade policies, including sweeping new import tariffs announced by President Donald Trump that have intensified global trade tensions and heightened investor anxiety. Also, central banks worldwide have been accumulating gold reserves, led by risks arising from Trump’s policies.
Prices of the yellow metal rocketed to a record high of $3,500 per ounce on April 22. While gold prices have fallen from their April 2025 highs, they remain favorable. The yellow metal is gaining from safe-haven demand triggered by trade and geopolitical uncertainties, and is currently hovering above the $3,300 per ounce level. Increased purchases by central banks, geopolitical tensions, and the threat of additional tariffs are factors expected to support bullion prices.
NEM offers a dividend yield of 1.4% at the current stock price. Its payout ratio is 20% (a ratio below 60% is a good indicator that the dividend will be sustainable). Backed by strong cash flows and sound financial health, the company's dividend is perceived as safe and reliable.
Newmont’s earnings estimates for 2025 have been going up over the past 60 days. The Zacks Consensus Estimate for third-quarter 2025 has also been revised higher over the same time frame.
The Zacks Consensus Estimate for 2025 earnings is currently pegged at $5.27, suggesting year-over-year growth of 51.4%. Earnings are expected to register roughly 54.3% growth in the third quarter.
Image Source: Zacks Investment Research
A Look at Newmont Stock’s Valuation
Newmont is currently trading at a forward price/earnings of 13.12X, a roughly 2.5% discount when stacked up with the Zacks Mining – Gold industry’s average of 13.45X. NEM is trading at a premium to Barrick and a discount to Agnico Eagle and Kinross Gold. Both Newmont and Kinross Gold currently have a Value Score of B. Barrick has a Value Score of A, while Agnico Eagle has a Value Score of D.
NEM’s P/E F12M Vs. Industry, B, AEM and KGC
Image Source: Zacks Investment Research
How to Play the NEM Stock?
Newmont presents a compelling investment case, backed by a robust portfolio of growth projects, the strong performance of its Tier 1 assets, and solid financial health. The asset streamlining rooted in Newmont’s objective to concentrate capital on high-return, long-life assets also underpins its long-term sustainability. Other positives include rising earnings estimates and a healthy growth trajectory. Higher realized gold prices should boost NEM’s profitability and drive cash flow generation. With a positive earnings outlook, Newmont looks poised to deliver attractive returns to its investors, making this Zacks Rank #1 (Strong Buy) stock a prudent choice to bet on for those looking to capitalize on still-favorable gold market conditions.
Image: Bigstock
Newmont Shares Rally 85% YTD: How Should You Play the Stock?
Key Takeaways
Newmont Corporation’s (NEM - Free Report) shares have surged 85.4% so far this year, thanks to the gold price rally resulting from trade and geopolitical uncertainties and its forecast-topping earnings performance underscoring its operational efficiency and the strength of its Tier 1 portfolio. NEM stock has outperformed the Zacks Mining – Gold industry’s 72.2% rise and the S&P 500’s increase of 9.6%. Among its gold mining peers, Barrick Mining Corporation (B - Free Report) , Agnico Eagle Mines Limited (AEM - Free Report) and Kinross Gold Corporation (KGC - Free Report) have rallied 56.5%, 70.7% and 109.1%, respectively, over the same period.
NEM’s YTD Price Performance
Technical indicators for NEM show bullish momentum. NEM eclipsed its 50-day simple moving average (SMA) on May 19, 2025. The NEM stock is also currently trading above its 200-day SMA, suggesting a long-term uptrend. The 50-day SMA is also reading higher than the 200-day SMA, following a golden crossover on April 16, 2025, indicating a bullish trend.
NEM Stock Trades Above 50-Day SMA
Is the time right to buy NEM’s shares for potential upside? Let’s take a look at the stock’s fundamentals.
Key Projects & Asset Streamlining to Drive NEM’s Growth
Newmont continues to invest in growth projects in a calculated manner. The company is pursuing several projects, including Tanami Expansion 2 in Australia, the Ahafo North expansion in Ghana and Cadia Panel Caves in Australia. These projects should expand production capacity and extend mine life, driving revenues and profits.
The acquisition of Newcrest Mining Limited has also created an industry-leading portfolio with a multi-decade gold and copper production profile in the most favorable mining jurisdictions globally. The combination of Newmont and Newcrest is expected to deliver significant value for its shareholders and generate meaningful synergies. NEM has achieved $500 million in annual run-rate synergies, following the Newcrest buyout.
Newmont has also divested non-core businesses as it shifts its strategic focus to Tier 1 assets. NEM completed its non-core divestiture program in April 2025 with the sale of its Akyem operation in Ghana and its Porcupine operation in Canada. NEM has executed agreements to sell its shares in Greatland Resources Limited and Discovery Silver Corp, for total cash proceeds of around $470 million after taxes and commissions. Following the sale of these shares, the company anticipates generating $3 billion in after-tax cash proceeds from its 2025 divestiture program. These funds will support Newmont’s capital allocation strategy, which focuses on reinforcing its balance sheet and delivering returns to its shareholders.
Robust Financial Health Supports NEM’s Capital Allocation
Newmont has a strong liquidity position and generates substantial cash flows, which allow it to fund its growth projects, meet short-term debt obligations and drive shareholder value. At the end of the second quarter of 2025, Newmont had robust liquidity of $10.2 billion, including cash and cash equivalents of around $6.2 billion. Its free cash flow surged nearly threefold year over year and 42% from the prior quarter to $1.7 billion, led by an increase in net cash from operating activities and lower capital investment. Net cash from operating activities shot up 17% from the prior quarter to $2.4 billion. NEM delivered roughly $2 billion to its shareholders through dividends and share repurchases, and reduced debt by $1.4 billion since the beginning of 2025. Newmont’s board has also authorized an additional $3 billion share repurchase program. Its long-term debt-to-capitalization is around 18.8%.
Newmont stands to benefit from the strength in gold prices, which should drive its profitability and cash flow generation. Gold prices have rallied roughly 27% this year, largely attributable to aggressive trade policies, including sweeping new import tariffs announced by President Donald Trump that have intensified global trade tensions and heightened investor anxiety. Also, central banks worldwide have been accumulating gold reserves, led by risks arising from Trump’s policies.
Prices of the yellow metal rocketed to a record high of $3,500 per ounce on April 22. While gold prices have fallen from their April 2025 highs, they remain favorable. The yellow metal is gaining from safe-haven demand triggered by trade and geopolitical uncertainties, and is currently hovering above the $3,300 per ounce level. Increased purchases by central banks, geopolitical tensions, and the threat of additional tariffs are factors expected to support bullion prices.
NEM offers a dividend yield of 1.4% at the current stock price. Its payout ratio is 20% (a ratio below 60% is a good indicator that the dividend will be sustainable). Backed by strong cash flows and sound financial health, the company's dividend is perceived as safe and reliable.
NEM’s Rising Earnings Estimates Reflect Positive Sentiment
Newmont’s earnings estimates for 2025 have been going up over the past 60 days. The Zacks Consensus Estimate for third-quarter 2025 has also been revised higher over the same time frame.
The Zacks Consensus Estimate for 2025 earnings is currently pegged at $5.27, suggesting year-over-year growth of 51.4%. Earnings are expected to register roughly 54.3% growth in the third quarter.
A Look at Newmont Stock’s Valuation
Newmont is currently trading at a forward price/earnings of 13.12X, a roughly 2.5% discount when stacked up with the Zacks Mining – Gold industry’s average of 13.45X. NEM is trading at a premium to Barrick and a discount to Agnico Eagle and Kinross Gold. Both Newmont and Kinross Gold currently have a Value Score of B. Barrick has a Value Score of A, while Agnico Eagle has a Value Score of D.
NEM’s P/E F12M Vs. Industry, B, AEM and KGC
How to Play the NEM Stock?
Newmont presents a compelling investment case, backed by a robust portfolio of growth projects, the strong performance of its Tier 1 assets, and solid financial health. The asset streamlining rooted in Newmont’s objective to concentrate capital on high-return, long-life assets also underpins its long-term sustainability. Other positives include rising earnings estimates and a healthy growth trajectory. Higher realized gold prices should boost NEM’s profitability and drive cash flow generation. With a positive earnings outlook, Newmont looks poised to deliver attractive returns to its investors, making this Zacks Rank #1 (Strong Buy) stock a prudent choice to bet on for those looking to capitalize on still-favorable gold market conditions.
You can see the complete list of today’s Zacks #1 Rank stocks here.