AEM vs. NEM: Which Gold Mining Stock Should You Invest in Now?

Anindya Barman August 28, 2025

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Key Takeaways

AEM boosted Q2 free cash flow to $1.3B, aided by strong operations and higher gold prices.
Newmont's Newcrest buyout and $3B divestiture program strengthened its portfolio and reinforced liquidity.
Estimates for both miners are trending upward over the past 60 days, with higher projected sales and EPS.

Agnico Eagle Mines Limited (AEM - Free Report) and Newmont Corporation (NEM - Free Report) are two prominent players in the gold mining space with global operations and diversified portfolios. With gold prices remaining firm, driven by global economic uncertainties and trade tensions, comparing these two industry giants is particularly relevant for investors seeking exposure to the precious metals sector.

Gold prices have shot up roughly 29% 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 zoomed 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 and are currently hovering near the $3,400 per ounce level. Increased purchases by central banks, hopes of interest rate cuts, and geopolitical tensions are expected to support gold prices.

Let’s dive deep and closely compare the fundamentals of these two mining giants to determine which one is a better investment now.

The Case for Agnico Eagle

Agnico Eagle is focused on executing projects that are expected to provide additional growth in production and cash flows. It is advancing its key value drivers and pipeline projects, including the Odyssey project in the Canadian Malartic Complex, Detour Lake, Hope Bay, Upper Beaver and San Nicolas.

The Hope Bay Project, with proven and probable mineral reserves of 3.4 million ounces, is expected to play a significant role in generating cash flow in the years to come. The processing plant expansion at Meliadine was completed and commissioned in the second half of 2024, with mill capacity expected to increase to roughly 6,250 tons per day in 2025.

The merger with Kirkland Lake Gold established Agnico Eagle as the industry's highest-quality senior gold producer. The integrated entity now has an extensive pipeline of development and exploration projects to drive sustainable growth. It also has the financial flexibility to fund a strong pipeline of growth projects.

AEM has a robust liquidity position and generates substantial cash flows, which allow it to maintain a strong exploration budget, finance a strong pipeline of growth projects, pay down debt and drive shareholder value. Its operating cash flow for the second quarter was $1,845 million in the second quarter, up 92% from $961 million a year ago.

AEM recorded second-quarter free cash flow of $1,305 million, more than doubling the prior-year quarter figure of $557 million. This was backed by the strength in gold prices and robust operational results.

The company remains focused on paying down debt using excess cash, with long-term debt reducing by $550 million sequentially to $595 million at the end of the second quarter. It ended the quarter with a significant net cash position of $963 million, driven by the increase in cash position and reduction of debt. AEM also returned around $300 million in the second quarter.

AEM offers a dividend yield of 1.2% at the current stock price. It has a five-year annualized dividend growth rate of 6.9%. AEM has a payout ratio of 27% (a ratio below 60% is a good indicator that the dividend will be sustainable). The company's dividend is perceived as safe and reliable, backed by strong cash flows and sound financial health.

The Case for Newmont

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.

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% compared with Agnico Eagle’s just 2.8%. NEM offers a dividend yield of 1.4% at the current stock price. Its payout ratio is 20%, with a five-year annualized dividend growth rate of about -14.2%.

Newmont, however, is being challenged by higher production costs, which will likely weigh on its margins over the near term. Its second-quarter costs applicable to sales and all-in-sustaining costs (AISC) rose around 6% and 2% year over year, respectively. The company expects AISC from its core portfolio to be modestly higher than the full-year guidance in the third quarter due to an uptick in sustaining capital spending.

Moreover, Newmont expects gold AISC for the total portfolio to be $1,630 per ounce in 2025, reflecting a rise from $1,516 per ounce in 2024, with AISC for the core portfolio forecast at $1,620 per ounce. In the third quarter, sustaining capital spending is expected to rise significantly from the second quarter due to an increase in planned investments.

Price Performance and Valuation of AEM & NEM

Year to date, AEM stock has rallied 78.4%, while NEM stock has racked up a gain of 94.5% compared with the Zacks Mining – Gold industry’s increase of 82.3%.