Is Newmont Stock a Screaming Buy After a 155% Rally in a Year?

Newmont Corporation's NEM shares have shot up 154.5% in the past year, thanks to an upswing in gold prices to record highs. The company’s strong earnings performance, driven by its operational efficiency and the strength of its Tier 1 portfolio, also contributed to the rally.

NEM stock has outperformed the Zacks Mining – Gold industry’s 131.2% rally and the S&P 500’s rise of 26.1%. Among its gold mining peers, Barrick Mining Corporation B, Agnico Eagle Mines Limited AEM and Kinross Gold Corporation KGC have rallied 142.6%, 117% and 185.6%, respectively, over the same period.

NEM’s One-year Price Performance

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The NEM stock has been trading above its 200-day simple moving average (SMA) since April 9, 2025, suggesting a long-term uptrend. It slipped below its 50-day SMA yesterday amid a pullback in gold prices on inflation worries. Nevertheless, the 50-day SMA is reading higher than the 200-day SMA, following a golden crossover on April 16, 2025, indicating a bullish trend.

NEM Stock Trades Below 50-Day SMA

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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 Aid NEM’s Growth

Newmont continues to invest in growth projects in a calculated manner. The company is pursuing several projects, including the Cadia Panel Caves and Tanami Expansion 2 in Australia. These projects should expand Newmont’s production capacity and extend mine life, driving revenues and profits.

In October 2025, NEM achieved a significant milestone at Ahafo North. It achieved commercial production at the project, which followed the first gold pour in September 2025. Ahafo North is expected to produce between 275,000 and 325,000 ounces of gold annually over an estimated mine life of 13 years. Output is expected to be 315,000 ounces this year, with a ramp-up to full capacity.

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.

The company generated $3.6 billion from its portfolio optimization actions in 2025. These funds will support Newmont’s capital allocation strategy, which focuses on reinforcing its balance sheet and delivering returns to its shareholders.

Solid 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 2025, Newmont had robust liquidity of roughly $11.6 billion, including cash and cash equivalents of around $7.6 billion. Its free cash flow nearly doubled year over year to a record $2.8 billion in the fourth quarter and surged two-and-a-half-fold year over year to a record $7.3 billion, led by an increase in net cash from operating activities. Net cash from operating activities shot up 44% from the prior-year quarter to $3.6 billion, and surged 62% to $10.3 billion in 2025.

NEM has distributed $3.4 billion to its shareholders through dividends and share repurchases in 2025. It also remains committed to deleveraging, reducing debt by roughly $3.4 billion in 2025, resulting in a strong net cash position of $2.1 billion. NEM announced an increased dividend of 26 cents per share for the fourth quarter of 2025. Newmont has executed $3.6 billion from $6 billion of buyback authorization as of Feb. 19, 2026.

Newmont stands to benefit from the strength in gold prices, which should drive its profitability and cash flow generation. Gold prices saw a record-setting rally last year, mainly attributable to aggressive trade policies, including sweeping new import tariffs announced by President Donald Trump, which 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.

The yellow metal entered 2026 with a stronger momentum. Heightened geopolitical strains, triggered by U.S.-Iran tensions, a weaker U.S. dollar and concerns over the independence of the Federal Reserve fueled the spike in bullion to record levels, with prices soaring to a fresh high of nearly $5,600 per ounce in late January.

This was followed by a brief pullback to below $4,900 per ounce due to aggressive profit-booking and a rebound in the U.S. dollar after hitting a four-year low. Bargain hunting following the massive selloff again pushed up prices to above $5,000 per ounce.

Gold gained strength earlier this month, surging past $5,400 per ounce on March 2 amid strong safe-haven demand after the United States and Israel began joint strikes on Iran, leading to a major escalation. Gold prices have again pulled back from that level due to a stronger U.S. dollar and reduced expectations of Federal Reserve rate cuts on inflation worries amid a spike in oil prices, currently hovering above $5,100 per ounce.

Increased central bank buying and persistent safe-haven demand driven by the war in the Middle East and concerns over further escalation in the coming days, as well as broader macroeconomic uncertainty, are expected to underpin gold prices.

NEM offers a dividend yield of 0.9% at the current stock price. Its payout ratio is 14% (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 Earnings Estimates Moving Higher

Newmont’s earnings estimates for 2026 have been going up over the past 60 days. The Zacks Consensus Estimate for 2027 has also been revised higher over the same time frame.

The Zacks Consensus Estimate for 2026 earnings is currently pegged at $8.79, suggesting year-over-year growth of 27.6%. Earnings are expected to grow roughly 17.6% in 2027.

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A Look at Newmont Stock’s Valuation

Newmont is currently trading at a forward price/earnings of 12.99X, a modest 0.8% discount to the industry’s average of 13.1X. NEM is trading at a premium to Barrick and Kinross Gold and at a discount to Agnico Eagle. Newmont currently has a Value Score of C. Barrick and Kinross Gold have a Value Score of B each, while Agnico Eagle has a Value Score of D.

NEM’s P/E F12M Vs. Industry, B, AEM and KGC

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Final Thoughts: Buy NEM Shares

Newmont is well-placed for growth with the strong performance of its Tier 1 assets and a robust portfolio of projects, which should expand production capacity and extend mine life, thereby driving revenues and profits. 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. Favorable bullion prices should also 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 the favorable gold market conditions.

You can see the complete list of today’s Zacks #1 Rank stocks here.

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Newmont Corporation (NEM): Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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