GoldMining Inc.: Undervalued Assets and Strategic Momentum Signal Buying Opportunity

GoldMining Inc. (GMNGF) has positioned itself as a contrarian play in the mining sector, with its Q2 2025 unaudited results hinting at a turnaround fueled by strategic investments and declining losses. Despite near-term liquidity challenges, the company's focus on undervalued assets like NevGold Corp (NAU.V) and Gold Royalty Corp (GRC) has created a compelling opportunity for investors. Let's dissect the financials and strategic moves that suggest a buying window before audited results solidify the narrative.

Financial Highlights: Narrowing Losses and Gains from Strategic Bets

GoldMining's Q2 2025 results reveal a narrowing net loss of $7.5 million, a 12% improvement compared to the same period in 2024. While cash reserves dipped to $6.0 million due to operational outflows, the company's non-current assets surged to $130 million, driven by long-term investments in high-potential projects. The key driver of this shift? Strategic equity stakes in mining peers, particularly NevGold.

The NevGold Catalyst:
GoldMining holds a 22.8% stake in NevGold, which contributed a $295,000 net gain in Q2 2025. This gain reflects both dilution-related profits and NevGold's own operational improvements. NevGold's Q4 2024 results highlighted a 31% drop in all-in sustaining costs (AISC) to $1,239/oz gold, alongside a $153 million adjusted net earnings jump. These metrics, coupled with NevGold's 60% YTD stock surge (vs. a 10% rise in the S&P/TSX), underscore the undervalued nature of GoldMining's investment.

Why the Cash Drop Doesn't Tell the Full Story

While GoldMining's cash reserves have fallen, its balance sheet remains bolstered by $54.7 million in long-term investments, primarily in Gold Royalty Corp (GRC). These assets, marked to market, generated $15.8 million in unrealized gains in Q2, driving comprehensive income to a positive $5.6 million. The company also raised $2.6 million through equity ATM programs, signaling continued access to capital to fund strategic bets.

Critics may flag the cash decline, but the priority here is clear: GoldMining is reallocating liquidity into high-growth equity stakes rather than holding cash. This strategy aligns with its long-term focus on asset value appreciation, not short-term liquidity.

Operational Momentum and Risk Mitigation

GoldMining's Q2 results also highlight operational discipline:
- Cost Controls: General and administrative expenses fell to $3.8 million, down from $4.6 million in 2024.
- Core Project Focus: Exploration spending remained steady at $1.6 million, with priority given to high-potential projects like São Jorge (Brazil) and Whistler (Alaska).

Risks remain, including market volatility and the need for $80 million in funding for NevGold's upcoming feasibility study. However, GoldMining's ownership stake in NevGold (now 22.8%) positions it to benefit disproportionately from any positive news flow, such as cost reductions or permitting progress.

Investment Thesis: A Contrarian Play on Undervalued Mining Assets

The case for buying GoldMining now hinges on three pillars:
1. Undervalued Asset Exposure: NevGold's stock has surged 60% YTD, yet GoldMining's shares have lagged, offering a chance to buy into its stake at a discount.
2. Declining Losses and Cash Flow Turnaround: The narrowing net loss and positive comprehensive income suggest a path to profitability.
3. Strategic Capital Allocation: The shift from cash to equity investments in high-growth peers like GRC and NevGold signals management's confidence in their portfolio.

Conclusion: Buy the Dip Before Audited Results Confirm the Turnaround

GoldMining's Q2 results are a mixed bag on the surface, but beneath the noise lies a compelling narrative of strategic gains and margin improvement. With NevGold's operational turnaround and Gold Royalty's unrealized gains fueling the company's value, investors should consider a position here. The $6.0 million cash drop is a near-term concern, but it's outweighed by the potential upside of its equity stakes.

Recommendation:
- Buy GMNGF for a long-term play on mining sector recovery.
- Hold for 6–12 months to capitalize on NevGold's feasibility study progress and audited results validation.

The market may overlook GoldMining's undervalued assets today, but as NevGold's story gains momentum, this stock could surprise on the upside.

This analysis is based on unaudited Q2 2025 results and assumes no material changes in the macroeconomic environment or project timelines.