Why Has Newmont Stock Surged 135%?

December 5th, 2025 by Trefis Team
-0.26%
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90.72
Market
90.48
Trefis
NEM: Newmont logo
NEM
Newmont

135% is roughly the gain Newmont (NYSE:NEM) has delivered year-to-date (YTD) in 2025. Newmont’s rally has largely been powered by a dramatic surge in gold prices. As precious-metal demand soared amid macroeconomic uncertainty, global investors turned to gold as a safe haven — and Newmont, as one of the world’s largest gold (and copper) producers, benefited directly.

At the same time, Newmont’s own company actions helped amplify the gains. The firm has been streamlining its portfolio: selling non-core assets such as its stake in Orla Mining Ltd. and the Coffee Project in Yukon, raising hundreds of millions of dollars in proceeds. Cost-cutting, rationalization, and operational efficiency have supported margins and improved cash flow — a powerful combination in a commodity-driven business. Moreover, Newmont has significantly strengthened its balance sheet: as of its last reports, the company reduced debt dramatically — near-zero net debt now — and generated substantial free cash flow, backed by healthy operating cash flows and strong liquidity.

If you seek an upside with less volatility than holding an individual stock, consider the High Quality Portfolio. It has comfortably outperformed its benchmark—a combination of the S&P 500, Russell, and S&P MidCap indexes—and has achieved returns exceeding 105% since its inception. Separately, see –What’s Next For Gamestop Stock After The 38% Drop?

What the numbers say about the underlying strength

Recent company data paint a bullish picture. Newmont has delivered consistent revenue growth, reportedly up by about 26.6% (LTM – last twelve months), with an average growth rate of about 23.9% over the last three years. The firm’s operating cash flow margin is approximately 32.6%, and its long-term operating margin around 23.9% — both strong numbers for a mining business.

The combination of near-zero net debt, robust free cash flow, and proceeds from divestments has given Newmont financial flexibility. That flexibility supports ongoing dividends, share repurchases, and reinvestment in core high-quality assets or growth projects — a stable foundation even if gold prices remain volatile.

What could come next for Newmont

If gold prices continue their strength, possibly driven by global macro uncertainty or further monetary easing, Newmont is well positioned to ride the upswing. Its low debt, strong cash flow, and efficient operations mean it could deliver outsized profits if bullion remains high.

On the operational front, Newmont’s focus on its core “Tier-1” mines and ongoing productivity improvements suggest potential for stable output and margin resilience even if costs or external headwinds rise.

However, the company remains exposed to commodity price volatility. If gold weakens — perhaps due to a strengthening dollar, shift in global interest rates, or reduced investor demand for safe-haven assets — Newmont’s profitability could be hit.

Additionally, as with all mining firms, geopolitical, regulatory, or environmental risks tied to its global operations remain non-trivial — and could affect future results irrespective of broader gold trends. We value Newmont stock at $90, in line with the current market price.

Now, we apply a risk assessment framework while constructing the Trefis High Quality (HQ) Portfolio, which, with a collection of 30 stocks, has a track record of comfortably outperforming the S&P 500 over the last 4-year period — and has achieved returns exceeding 105% since its inception. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics.

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