Newmont Mining Corporation
NEM
$119.71
+1.35%
Newmont Corporation is the world's largest gold miner, operating a portfolio of 11 mines and two joint ventures across the Americas, Africa, Australia, and Papua New Guinea, producing gold as its primary product alongside meaningful byproduct credits in copper, silver, zinc, and lead. The company's scale, built through the transformative Goldcorp and Newcrest acquisitions and its Nevada joint venture with Barrick, gives it a distinct position as the sector's benchmark large-cap gold producer with roughly two decades of reserves. The current investor narrative centers on a powerful free-cash-flow story — record quarterly FCF of over $2 billion driven by elevated gold prices and post-integration cost discipline — set against a more cautious operational backdrop of declining production volumes and rising all-in sustaining costs. Recent headlines capture this tension: Q3 2026 earnings and revenues topped estimates and management improved cost guidance while advancing a strategic Nevada expansion expected to drive production growth into 2027, yet analysts remain divided on near-term upside given gold price volatility and production challenges. The stock's dramatic August surge on gold's rally and a strategic Barrick deal has given way to consolidation, leaving investors debating whether the cash-flow bonanza is a durable re-rating or a cyclical peak.…
NEM
Newmont Mining Corporation
$119.71
Related headlines
Investment Opinion: Should I buy NEM Today?
Rating: Buy, with moderate conviction. The core thesis is that Newmont generates roughly $10.07 billion of trailing free cash flow at a price-to-cash-flow of just 10.69x, and the sell-side consensus of $135.46 implies about 26% upside from $107.47 — a gap that frames the recent 7.00% one-month pullback as an entry point rather than a thesis break. The 19 Buy versus 3 Hold and 1 Sell split (recommendation mean 1.65) anchors this view, though the wide $70-$165 target range means the rating is a bet on gold prices holding, not a low-risk value call.
Supporting evidence is concrete: Q3 2026 revenue of $6.363 billion grew 18.27% year-over-year, gross margin expanded to 66.32% from 48.29% a year earlier, and net margin reached 38.9% on $2.475 billion of net income. The balance sheet is fortress-like with debt-to-equity of 0.169, a current ratio of 2.29, and $8.876 billion of cash, while the forward PE of 10.75x sits roughly 31% below the trailing 15.58x, implying consensus EPS of $10.14 versus trailing earnings. At 7.70x EV/EBITDA, Newmont sits mid-range versus gold peers typically at 6-9x, so investors are paying a fair, not premium, price for the scale and cash-generation advantage.
The biggest risks that could invalidate the thesis are a gold price correction compressing the 66.32% gross margin toward the 41.68% level seen in Q1 2025, continued volume decline (roughly 5.3 million ounces expected in 2026 after six mine divestitures), and earnings volatility that has swung EPS from $3.01 in Q1 2026 to $2.36 in Q3. This Buy would downgrade to Hold if gold retreats and free cash flow halves, or upgrade to a higher-conviction Buy if the Nevada expansion confirms 2027 production growth while the stock holds above the $90-$93 support zone. On valuation, the stock is fairly valued to modestly undervalued on earnings multiples (PE near historical lows) but near the high end of its book-value range at 3.26x P/B — a divergence that leaves the verdict dependent on whether peak-cycle earnings prove durable.
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NEM 12-Month Price Forecast
The forward view is constructive but not complacent: Newmont's cash engine is exceptional, with $10.07 billion of TTM free cash flow and a 10.69x price-to-cash-flow multiple that leaves room for re-rating if gold holds. The 26% upside to the $135.46 consensus target and the 19-to-3 Buy-to-Hold split support a bullish stance, and the fortress balance sheet (0.169 D/E, 2.29 current ratio) means the company can fund the Nevada expansion and buybacks through a downturn. However, confidence is only medium because the earnings base is cyclical — EPS swung from $3.01 in Q1 2026 to $2.36 in Q3 — and the 2.3x spread between the $70 and $165 targets shows genuine disagreement about the gold cycle. I would upgrade to high confidence if the stock reclaims $135 on volume with gold holding, and downgrade to neutral if it breaks below the $90-$93 support zone or if free cash flow shows signs of halving.
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 $135.46 and implied upside of +13.2% versus the current price.
Average Target
$135.46
23 analysts
Implied Upside
+13.2%
vs. current price
Analyst Count
23
covering this stock
Price Range
$70 - $165
Analyst target range
Newmont is covered by 21 analysts with a decisively bullish tilt: 19 Buy ratings, 3 Hold, and 1 Sell, yielding a consensus recommendation of "buy" and a recommendation mean of 1.65 (where 1.0 is a strong buy). The average target price of $135.46 implies roughly 26% upside from the current $107.47, a meaningful gap that suggests the sell-side views the recent pullback as an opportunity rather than a deterioration. The consensus leans clearly bullish, with the Buy-to-Hold ratio above 6:1, though the presence of a lone Sell rating and three Holds indicates a minority view that the gold price cycle may be near a peak.
The target range is wide, spanning from a low of $70.00 to a high of $165.00 — a spread of more than 2.3x that signals substantial disagreement about the trajectory of gold prices and Newmont's production profile. The high target of $165 likely assumes sustained or higher gold prices, successful execution of the Nevada expansion, and continued multiple expansion on record free cash flow, while the low target of $70 prices in a sharp gold correction, margin compression from rising costs, and production shortfalls. Institutional ratings show a predominantly stable-to-positive pattern — Scotiabank, Citigroup, Barclays, RBC, and Bernstein all maintain Outperform/Overweight/Buy ratings through October 2026, with TD Cowen upgrading to Buy from Hold in July and only Freedom Broker downgrading to Hold from Buy in late October. This mix of steady conviction punctuated by a recent downgrade and a very wide target spread suggests high uncertainty around the commodity outlook, even as the fundamental cash-generation story remains compelling.
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Bulls vs Bears: NEM Investment Factors
The bull case currently has stronger evidence: $10.07 billion of TTM free cash flow, 66.32% gross margins, a 0.169 debt-to-equity ratio, and a 26% implied upside to a $135.46 consensus target are concrete and quantifiable, whereas the bear case rests more on forward-looking concerns about gold price durability and declining volumes. The single most important tension is whether Newmont's earnings are a durable re-rating or a cyclical peak — the 15.58x trailing PE versus 10.75x forward PE shows the market is already pricing in earnings growth, so if gold prices hold and the Nevada expansion delivers production growth into 2027, the stock is cheap; if gold corrects, the low multiple becomes a value trap on peak-cycle earnings. The recent 7.00% one-month decline and -5.01% relative strength versus SPY suggest the market is currently leaning toward the cyclical-peak interpretation, even as 19 of 21 analysts maintain Buy ratings. The wide $70-$165 target range captures this binary commodity bet, and the stock's 0.573 beta means it will not shield investors from an absolute drawdown if the gold thesis breaks.
Bullish
- Record $10.07B TTM free cash flow: Trailing twelve-month free cash flow of $10.074 billion, including $1.912 billion in Q3 alone after $856 million of capex, is a staggering cash engine for a company with a $110 billion market cap. At a price-to-cash-flow of just 10.69x, investors are paying roughly ten times annual cash generation, and the company funded $1.779 billion of buybacks plus $272 million of dividends in Q3 entirely from internal cash.
- Elite margins expanding rapidly: Q3 2026 gross margin hit 66.32% versus 48.29% a year earlier, with operating margin at 49.71% and EBITDA margin of 60.87% ($3.873 billion on $6.363 billion of revenue). These margins are far above the 25-40% gross margin range typical for gold producers, reflecting powerful operating leverage on elevated gold prices layered on post-Newcrest integration synergies.
- Forward PE of 10.75x implies earnings growth: The forward PE of 10.75x sits roughly 31% below the trailing PE of 15.58x, implying consensus EPS of $10.14 versus trailing earnings — the market is embedding substantial earnings expansion. The PEG ratio of 0.125 is extraordinarily low, and the trailing PE has compressed from 20.80x at year-end 2025, suggesting the stock is cheap relative to its own history.
- Fortress balance sheet with 0.169 D/E: Debt-to-equity of just 0.169, a current ratio of 2.29, $8.876 billion of cash, and interest coverage above 100x mean Newmont has zero dependence on external financing. ROE of 20.92% and ROA of 16.37% confirm efficient capital deployment, giving the company ample capacity to fund the Nevada expansion and sustain buybacks through a gold downturn.
Bearish
- Production volumes declining structurally: Management expects to sell roughly 5.3 million ounces in 2026 after divesting six higher-cost mines, and analysts have flagged production challenges. Revenue growth of 18.27% YoY is being driven by realized gold prices rather than volume, so the investment case hinges entirely on price leverage and cost discipline — a fragile foundation if gold corrects.
- Momentum has rolled over sharply: The stock is down 7.00% over the past month and 5.30% over six months despite a 31.67% one-year gain, sitting at just 51.1% of its 52-week range ($78.60-$135.29). Relative strength versus SPY has flipped from +21.28% over one year to -5.01% over the past month, a classic momentum fade after the August parabolic spike to $135.14.
- Earnings are cyclical, not durable: Q1 2026 EPS of $3.01 fell to $2.36 in Q3, and Q4 2025 EPS was just $1.20 — a 60% swing within a year driven by gold prices and one-off tax items (Q4 2025 income tax expense of $2.07 billion). The PEG ratio of 0.125 is distorted by peak-cycle earnings, and the market's low trailing PE may be correctly discounting a cyclical peak rather than mispricing growth.
- Wide 2.3x analyst target spread signals uncertainty: Targets range from $70.00 to $165.00 — a spread of more than 2.3x — reflecting deep disagreement about gold prices and Newmont's production profile. Freedom Broker downgraded to Hold from Buy in late October, and three Holds plus one Sell indicate a minority view that the gold cycle is near a peak; the $70 low target implies a 35% downside from current levels.
NEM Technical Analysis
Newmont is in a choppy, range-bound consolidation phase within a broader one-year uptrend, with the stock up 31.67% over the trailing year but sitting at $107.47, roughly 51.1% of its 52-week range of $78.60 to $135.29. That mid-range positioning reflects a market that has neither fully rejected nor re-embraced the gold-miner thesis after the August spike to $135.14 — the stock is neither an overextended momentum name nor a falling knife, but a battleground where bulls and bears have reached an uneasy equilibrium. The 6-month change of -5.30% versus the +31.67% one-year gain confirms the trend has flattened materially since the spring.
Short-term momentum has clearly decelerated: the 1-month change of -7.00% and 3-month change of +3.05% show the stock rolling over after the summer rally, with the 1-month decline diverging sharply from the positive 1-year trend. This divergence signals mean reversion and profit-taking rather than outright trend reversal, particularly given the stock's relative strength of +21.28% versus SPY over one year but -5.01% over the past month — a classic momentum fade after a parabolic move. The pullback from the $135 area to the low $100s has unfolded on moderate volume (4.76 million shares), and the absence of a decisive volume spike on the decline suggests distribution is orderly rather than panicked.
Key technical levels are well defined: support sits at the 52-week low of $78.60, with intermediate support around the $90-$93 zone that held during the June-July consolidation, while resistance is anchored at the 52-week high of $135.29. A breakout above $135 would confirm a resumption of the primary uptrend and likely target new highs, whereas a breakdown below $90 would signal a deeper correction and test of the $78.60 floor. The stock's beta of 0.573 is a critical risk-management input — Newmont is roughly 43% less volatile than the broader market, meaning its drawdowns tend to be shallower than SPY's, but this low beta also means the stock requires larger position sizing to achieve equivalent portfolio risk exposure, and its -32.4% max drawdown shows it is far from a low-risk instrument in absolute terms.
Beta
0.57
0.57x market volatility
Max Drawdown
-32.4%
Largest decline past year
52-Week Range
$81-$135
Price range past year
Annual Return
+46.6%
Cumulative gain past year
| Period | NEM Return | S&P 500 |
|---|---|---|
| 1m | +2.9% | -5.9% |
| 3m | +6.0% | -5.2% |
| 6m | +2.7% | -0.6% |
| 1y | +46.6% | +8.2% |
| ytd | +18.3% | +7.5% |
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NEM Fundamental Analysis
Newmont's revenue trajectory is robust and re-accelerating, with Q3 2026 revenue of $6.363 billion representing 18.27% year-over-year growth versus the $5.380 billion reported in Q3 2025. The multi-quarter trend shows sequential strength — revenue climbed from $6.118 billion in Q2 to $6.363 billion in Q3, following a strong $7.307 billion Q1 — with the gold dore segment contributing $4.13 billion and concentrate/other production adding $2.233 billion. This growth is being driven primarily by elevated realized gold prices rather than volume expansion, since management has flagged declining production and the company expects to sell roughly 5.3 million ounces in 2026 after divesting six higher-cost mines; the investment case therefore hinges on price leverage and cost discipline rather than organic volume growth.
Profitability is exceptional and expanding: Q3 2026 net income reached $2.475 billion on a 38.9% net margin, with gross margin at 66.32% and operating margin at 49.71% — a dramatic improvement from the 48.29% gross margin in Q3 2025 and the 41.68% gross margin in Q1 2025. The margin expansion is visible across the income statement, with gross profit rising from $2.598 billion a year ago to $4.220 billion, and EBITDA of $3.873 billion representing a 60.87% EBITDA margin. These are elite margins for the gold mining industry, where producers typically operate in the 25-40% gross margin range depending on grade and cost structure, and they reflect the powerful operating leverage of a high gold price environment layered on post-Newcrest integration synergies.
The balance sheet is fortress-like and cash generation is prodigious: debt-to-equity stands at just 0.169, the current ratio is a healthy 2.29, and trailing twelve-month free cash flow is $10.074 billion, with Q3 FCF of $1.912 billion after $856 million of capex. Return on equity of 20.92% and return on assets of 16.37% confirm efficient capital deployment, while the company returned substantial capital via $1.779 billion of buybacks and $272 million of dividends in Q3 alone, funded entirely from internal cash flow. With $8.876 billion of cash on the balance sheet and interest coverage above 100x, Newmont has no dependence on external financing and ample capacity to fund growth projects, sustain buybacks, and weather gold price downturns.
Quarterly Revenue
$6.4B
2026-09
Revenue YoY Growth
+18.3%
YoY Comparison
Gross Margin
66.3%
Latest Quarter
Free Cash Flow
$10.1B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is NEM Overvalued?
Because Newmont is solidly profitable with positive net income of $2.475 billion in Q3 and trailing EPS, the PE ratio is the appropriate primary metric, and the trailing PE of 15.58x against a forward PE of just 10.75x reveals a striking gap that implies the market expects earnings to grow substantially — the forward multiple is roughly 31% below the trailing multiple, signaling that consensus EPS estimates of $10.14 embed significant earnings expansion, likely from higher realized gold prices and cost improvements. The PEG ratio of 0.125 is extraordinarily low, suggesting the stock is cheap relative to its expected earnings growth rate, though this metric can be distorted by cyclical earnings in commodity producers.
Against the broader Basic Materials sector, Newmont's valuation presents a mixed picture: its PS ratio of 4.87x and EV/EBITDA of 7.70x are moderate for a large-cap miner, while the PB ratio of 3.26x reflects the premium the market assigns to its reserve base and cash generation. The EV/Sales of 4.08x and price-to-cash-flow of 10.69x are reasonable for a company generating $10 billion in annual free cash flow, and the 1.00% dividend yield with a conservative 15.6% payout ratio leaves substantial room for dividend growth. Relative to gold-mining peers that often trade at EV/EBITDA multiples of 6-9x, Newmont's 7.70x sits in the middle of the range, suggesting the market is pricing in its scale advantage and balance sheet strength without awarding an extreme premium.
Historically, Newmont's valuation has compressed dramatically from its prior peaks: the PE ratio has fallen from 20.80x at year-end 2025 and 65.05x in Q1 2024 to the current 15.58x, while the PS ratio has declined from 19.01x in Q3 2026's historical snapshot to 4.87x on a trailing basis. The stock's price-to-book of 3.26x is near the upper end of its multi-year range (which bottomed near 1.39x in late 2023), reflecting the market's re-rating of the business after the Newcrest integration and gold's rally. This places Newmont in an interesting position — its earnings multiple is near historical lows even as its book multiple is near highs, a divergence that suggests the market is pricing in optimistic cash-flow expectations while remaining cautious about the durability of peak-cycle earnings.
PE
15.6x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 7x~65x
vs. Industry Avg
16.4x
Industry PE ~16.4x*
EV/EBITDA
7.7x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks center on the fact that Newmont's earnings are levered to gold prices rather than volume growth. Management expects to sell roughly 5.3 million ounces in 2026 after divesting six higher-cost mines, and quarterly EPS has swung from $3.01 in Q1 2026 to $2.36 in Q3 and just $1.20 in Q4 2025 — a 60% peak-to-trough move within a year. Q4 2025 carried a $2.07 billion income tax expense that crushed net margin to 19.8% versus 38.9% in Q3 2026, illustrating how tax and price volatility can whipsaw reported earnings. While the balance sheet is strong (debt-to-equity of 0.169, current ratio of 2.29), the company's $10.07 billion TTM free cash flow is highly sensitive to realized gold prices, and rising all-in sustaining costs flagged by management could compress the 66.32% gross margin if the commodity rolls over.
Market and competitive risks are dominated by valuation compression and commodity cyclicality. The stock trades at a price-to-book of 3.26x, near the upper end of its multi-year range (which bottomed near 1.39x in late 2023), even as its trailing PE of 15.58x sits near historical lows — a divergence that leaves room for multiple compression if earnings normalize. The 2.3x spread between the $70 low and $165 high analyst targets signals genuine disagreement about the gold cycle, and Freedom Broker's late-October downgrade to Hold hints at peak-cycle concerns. With a beta of 0.573, Newmont is roughly 43% less volatile than the market, but that low beta also means it offers little portfolio diversification benefit against a sector rotation out of Basic Materials, and its -32.4% max drawdown shows it is far from a low-risk instrument in absolute terms.
The worst-case scenario is a sharp gold price correction combined with production shortfalls and cost inflation: realized prices fall, the 66.32% gross margin compresses toward the 41.68% level seen in Q1 2025, free cash flow halves, and the buyback that returned $1.779 billion in Q3 is curtailed. In that chain of events, the stock would likely retest its 52-week low of $78.60, a decline of roughly 27% from the current $107.47, and the analyst low target of $70.00 implies a steeper 35% downside. Given the -32.4% historical max drawdown, an investor could realistically lose 27-35% from current levels in an adverse gold-cycle scenario, and the low 1.00% dividend yield provides almost no income cushion during such a drawdown.
FAQ
The most severe risk is commodity price exposure: realized gold prices drive the 66.32% gross margin, and a correction toward the 41.68% margin seen in Q1 2025 would halve free cash flow and likely send the stock toward its $78.60 52-week low, roughly 27% below current levels. Second is operational: management expects to sell only about 5.3 million ounces in 2026 after divesting six higher-cost mines, so revenue growth of 18.27% YoY depends on price leverage rather than volume, and production shortfalls would compound any gold decline. Third is earnings volatility and tax risk — EPS swung from $3.01 in Q1 2026 to $2.36 in Q3, and Q4 2025's $2.07 billion income tax expense crushed net margin to 19.8% versus 38.9% in Q3 2026. Fourth is sentiment and valuation compression: the 2.3x spread between the $70 and $165 analyst targets, Freedom Broker's late-October downgrade to Hold, and a -5.01% one-month relative strength versus SPY all signal that momentum has faded after the August spike to $135.14.
The 12-month scenario framework assigns 50% probability to a base case of $120-$135.46, in which gold consolidates near current levels, margins hold above 60%, and the stock grinds back toward the $135.46 consensus target as the 7.00% one-month pullback reverses. The bull case (25% probability, $135.29-$165.00) requires gold to sustain or extend its rally alongside Nevada expansion milestones and further cost guidance improvements, taking the stock to its 52-week high and toward the $165 analyst high target. The bear case (25% probability, $70.00-$78.60) envisions a sharp gold correction compressing margins, halving free cash flow, and retesting the 52-week low. The base case is most likely, and its key assumption is that gold prices remain roughly stable rather than correcting — the single variable that most determines whether the low forward multiple is a discount or a trap.
The valuation picture is bifurcated. On earnings, Newmont looks cheap: the trailing PE of 15.58x falls to a forward PE of 10.75x, implying consensus EPS of $10.14 versus trailing earnings, and the PEG ratio of 0.125 is extraordinarily low. At 7.70x EV/EBITDA and 10.69x price-to-cash-flow, it sits mid-range versus gold peers typically at 6-9x EV/EBITDA, so investors pay a fair rather than premium price for scale and cash generation. However, the 3.26x price-to-book is near the top of its multi-year range (which bottomed near 1.39x in late 2023), and the trailing PE has compressed from 20.80x at year-end 2025 — a divergence suggesting the market is pricing optimistic cash-flow expectations while remaining cautious about earnings durability. The market appears to expect gold prices to hold and earnings to grow into the forward multiple; if that assumption fails, the low PE becomes a value trap on peak-cycle earnings rather than a discount.
On a risk/reward basis the setup is favorable but conditional: the stock at $107.47 sits about 26% below the $135.46 analyst average target, with 19 of 21 analysts rating Buy and a recommendation mean of 1.65. The downside is quantifiable — a retest of the $78.60 52-week low would mean roughly 27% losses, and the $70 analyst low target implies about 35% downside — so the reward-to-risk is roughly 1:1 against the base case and better only if gold holds. The biggest risk is that the 66.32% gross margin and $10.07 billion free cash flow are peak-cycle figures that compress sharply in a gold correction, as the swing from $3.01 Q1 2026 EPS to $2.36 in Q3 already hints. It is a good buy for investors who want gold exposure with a fortress balance sheet (0.169 debt-to-equity) and can tolerate a 25-35% drawdown, ideally accumulating near the $90-$93 support zone rather than chasing. It is less suitable for income investors given the 1.00% yield or for those who cannot stomach commodity cyclicality.
Newmont fits a medium-to-long-term holding period of at least 12-24 months, because the thesis depends on the Nevada expansion delivering production growth into 2027 and on gold prices holding through a full cycle rather than on near-term momentum. The stock's beta of 0.573 means it is roughly 43% less volatile than the market, which supports patient holding, but its -32.4% max drawdown and 60% swing in quarterly EPS from $3.01 to $1.20 show that drawdowns can still be severe. The 1.00% dividend yield with a conservative 15.6% payout ratio means returns come almost entirely from price appreciation and buybacks ($1.779 billion in Q3), so there is little income cushion while waiting. Short-term traders face a choppy range between $90-$93 support and $135 resistance with fading one-month momentum (-7.00%), making it a poor momentum vehicle right now. A reasonable approach is a staged accumulation over 12-24 months, adding near support and reassessing if gross margin falls below 60% or free cash flow halves.