Aris Mining's Operational Momentum Fuels Undervalued Upside in Gold's Bull Market

The global gold sector is in the throes of a structural shift, driven by inflationary pressures, geopolitical instability, and a growing preference for tangible assets. Amid this backdrop, Aris Mining Corporation (TSX: ARIS, NYSE-A: ARMN) has emerged as a standout performer, leveraging operational excellence and strategic investments to capitalize on the gold bull market. With a 13% year-over-year production increase in H1 2025 and a transformative mill expansion now online, Aris is positioned to deliver outsized returns as gold prices climb toward $3,700/oz by year-end. This article dissects the company's operational execution, capacity expansion, and gold price leverage—three pillars fueling its undervalued upside.

Operational Execution: A Foundation of Precision

Aris Mining's H1 2025 results underscore its ability to execute against ambitious targets. Total gold production rose to 113,415 ounces, with the Segovia Operations contributing 99,076 ounces—a 12% increase over 2024. The Marmato Narrow Vein Zone, meanwhile, delivered a 26% year-over-year production boost, highlighting the company's diversified asset base.

Key metrics reflect best-in-class performance:
- Segovia Mill Metrics: Processed 1,971 tonnes per day (tpd) at an average 9.61 grams per tonne (g/t) grade, with 96.1% recovery rates—premium figures that minimize unit costs.
- Sales Growth: Gold sales surged 15% year-over-year to 115,305 ounces, driven by strong demand and Aris's strategic sales timing.

The company's on-budget completion of the Segovia mill expansion in June 2025 was a critical milestone. This 3,000-tpd capacity upgrade is now ramping up, enabling higher throughput in the second half of the year. CEO Neil Woodyer emphasized that the mill's efficiency and scalability will be central to achieving 2025 production guidance of 230,000–275,000 ounces, with H2 output weighted to deliver the bulk of annual targets.

Capacity Expansion: Building for Scale and Sustainability

Aris's growth strategy hinges on leveraging its assets to achieve 500,000+ ounces annually by 2026. The Segovia mill's expansion is the first leg of this journey, but two additional projects will amplify its production profile:
1. Marmato Bulk Mining Zone: Expected to begin contributing in H2 2026, this open-pit operation offers a lower-cost production source with a 1.5 million-ounce reserve base.
2. Soto Norte Joint Venture: Aris's 51% stake in this Colombian project could add 50,000–70,000 ounces annually post-2026, further diversifying its output.

The company's focus on ESG compliance—including partnerships with Colombia's small-scale miners to improve safety and environmental practices—also mitigates regulatory risks and enhances long-term asset viability.

Gold Price Leverage: Riding the Bull Market

Gold's ascent to $3,400/oz in early July 行2025—and analyst forecasts of $3,700 by year-end—creates a tailwind for Aris. With gold prices up 42% year-over-year, every incremental ounce produced translates to outsized revenue gains.

Key leverage points:
- Cost Advantage: Aris's all-in sustaining costs (AISC) are projected to fall below $1,300/oz in 2025 due to higher throughput and operational efficiencies, amplifying margins as gold prices rise.
- Debt-Free Balance Sheet: A current ratio of 1.87 and $190 million trailing EBITDA provide liquidity to fund expansions without diluting shareholders.
- Undervalued Equity: Aris trades at 0.9x price-to-net asset value (P/NAV)—a 40% discount to historical averages—despite its premium assets and growth pipeline.

Investment Thesis: Why Aris is an Undervalued Play on Gold

Aris Mining checks all the boxes for investors seeking exposure to gold's bull market:
1. Operational Discipline: Consistent execution on production, costs, and capital projects.
2. Growth Catalysts: Segovia's mill ramp-up and Marmato's bulk mining phase provide near-term and long-term production catalysts.
3. Gold Price Sensitivity: A $100/oz increase in gold prices could boost Aris's annual earnings by ~$100 million, given its 2025 production targets.

Risks: Geopolitical tensions or a sharp decline in gold prices could pressure margins. However, the company's low-cost profile and diversified operations mitigate these risks.

Conclusion: A Buy on Undervaluation and Growth Momentum

Aris Mining is a buy at current levels, with a price target of $15–$18/share (up from ~$12 currently) as gold prices rise and production targets are met. Investors should pair a position in Aris with exposure to gold ETFs (e.g., GLD) to maximize leverage to the sector.

The company's strong operational track record, strategic expansions, and the secular gold bull market make it a compelling value play. With a 61% stock return over the past year and a $1.44 billion market cap, Aris is primed to deliver alpha as the gold narrative gains momentum.

Disclosure: The author holds no position in Aris Mining at the time of writing.