Gold Is On Fire, And This Overlooked Mining Stock is Starting To Shine

30‑Second Take

Why now? Gold has quietly surged to nearly $3,375/oz, up nearly 30% year-to-date, driven by geopolitical turmoil and rising demand from central banks.

Yet Newmont — the world’s largest gold producer — has only recently caught up.

Following a slow start to 2025, the company has found momentum on the back of stellar Q1 earnings, portfolio optimization, and surging bullion prices.

A UBS upgrade to “Buy” with a $60 price target affirms the new bullish backdrop. 

Newmont is finally syncing with gold’s bull run.

With the stock up 56% year-to-date and trading near a 52-week high, there is still more runway as fundamentals, analyst sentiment, and geopolitical catalysts align.

Trade Setup

Time frame: Medium- to long-term
Edge type: Macro-aligned momentum + earnings re-rate

Snapshot Table

Chart

5-Day Synopsis: NEM stock has plateaued slightly over the past few sessions after a sharp breakout that started June 12.

Still, it’s holding strong near its 52-week high, hovering above the key $58 level. 

Volume remains elevated, indicating institutional interest.

Given the run-up in gold prices and rising geopolitical instability, this consolidation may be the setup for a second leg higher.

Bull Case 

Core thesis: Newmont isn’t just the largest gold miner by volume, as it’s also one of the most geographically diversified, with assets across five continents and major recent expansion via its acquisition of Newcrest Mining.

This deal positions Newmont with a multi-decade production profile not just in gold, but also in copper, silver, and zinc.

With 55 consecutive years of dividend payments, a 1.72% forward yield, and a clean balance sheet (post-asset divestitures), NEM offers both stability and cyclical upside. 

The company’s Q1 results exceeded expectations by a wide margin, with adjusted EPS of $1.25 compared to $0.71 estimates and $5.01 billion in revenue.

The average realized gold price was $2,944/oz, and prices have only gone higher since.

Catalysts: 

Catalysts for NEM include:

• Gold price tailwind: With gold now above $3,350, NEM’s margin expansion story is accelerating.

• UBS upgrade: Analyst Daniel Major lifted NEM to “Buy” with a $60 target, citing gold’s momentum and Newmont’s earnings upside.

• Divestitures and deleveraging: Newmont raised $2.5B from selling non-core assets and cut long-term debt by $1B, setting up leaner operations going into H2.

• Newcrest integration: Expected to deliver $500M in annual pre-tax synergies by year-end 2025.

• Macroeconomic drivers: Safe-haven demand, Fed rate cut signals, and rising geopolitical tension (including U.S. strikes on Iran) all favor gold.

Valuation upside: Newmont is currently trading at just 13.2x trailing earnings, which is a discount compared to its historical average and well below where many analysts believe it should be trading in a strong gold environment. 

UBS and Trefis both estimate a fair value north of $60, representing 8–10% upside from current levels, even before accounting for potential earnings beats or upward guidance revisions.

Additionally, Newmont’s price-to-sales (P/S) ratio of 3.2x still trails the 2020–2021 peak of 3.6x, when gold traded at lower levels than today.

With realized gold prices nearing all-time highs and analyst forecasts suggesting gold could reach $3,500/oz by 2026, there is meaningful room for valuation multiples to expand. 

If Newmont’s Q2 and Q3 earnings continue to reflect these higher margins, a re-rating to historical P/S norms could push the stock comfortably into the mid-$60s, or higher if gold breaks out again.

Technical tailwind: Technically, NEM has staged an impressive breakout since early June, rising over 10% in under two weeks.

That move followed a multi-week base and was supported by strong volume.

Now, the stock is consolidating just under its 52-week high, holding above former resistance near $58, a bullish sign of digestion after a fast rally.

A clean break above $59.25 would represent a new closing high for 2025 and likely invite momentum buyers, with a short-term price target around $62–$63 based on prior measured moves.

RSI remains in bullish territory without being overbought, and the stock is trading firmly above its 50-day and 200-day moving averages.

If volume picks up alongside a breakout, technical tailwinds could accelerate upside into earnings season.

Bear Case 

Key risk: Despite rising gold prices, Newmont reported an 8% year-over-year decline in gold production in Q1, primarily driven by the sale of non-core assets.

While this was part of a strategic portfolio optimization effort, the reduced output limits Newmont’s near-term revenue leverage to higher gold prices. 

Any unexpected operational setbacks — such as cost overruns, labor disruptions, or underperformance at newly integrated Newcrest sites — could impact future quarters and delay the expected margin expansion.

Macro/sector headwinds: Gold’s rally is largely driven by macro fear, from geopolitical instability to dovish central bank expectations. But these forces are highly fluid.

• A de-escalation in the Middle East, particularly if tensions with Iran subside, could pressure safe-haven demand.

• Meanwhile, stronger-than-expected U.S. data or sticky inflation could delay the Fed’s anticipated rate cuts, strengthening the dollar and putting downward pressure on gold.

• Additionally, if real yields rise again (as they did in 2022–2023), investor demand for gold ETFs and mining equities could weaken quickly.

Newmont’s correlation with macro drivers is a double-edged sword — tailwinds can turn quickly.

Competitive threat: Newmont operates in a fiercely competitive field.

Rivals like Barrick Gold, Agnico Eagle, and Wheaton Precious Metals are also benefiting from the gold rally, and many are pushing hard on production, cost control, and digital mine optimization.

If these peers grow output more aggressively or report stronger margin expansion, investor capital may rotate their way.

Additionally, Newmont’s integration with Newcrest, although strategic, is still ongoing.

If integration costs run high or synergy goals fall short, the company could lose some investor confidence while peers execute more cleanly.

Crowded-trade concern: Gold equities have seen a surge in inflows over the past two weeks as investors seek protection from macroeconomic chaos.

While NEM is still below its all-time highs, sentiment has quickly turned bullish, and any cooling in the gold price or shift in narrative could spark fast reversals.

With the RSI near elevated territory and volume tapering slightly, profit-taking risk is rising, especially if Q2 earnings guidance doesn't exceed lofty expectations.

This makes timing entry points key, and raises short-term downside risk in the event of market-wide rotation out of defensives or safe havens.

Quick Checklist 

✅ Thesis still valid after today’s close
✅ Volume confirms momentum above key resistance levels
✅ Catalyst date double-checked (earnings July 22–28, 2025)

Deep‑Dive Links

• Q1 2025 Earnings Report 

• Analyst Ratings and Price Targets

• Short Interest Data

• Company Profile and Investor Relations

That’s all for today’s Everyday Alpha. We’ll have a new pick for you every morning before the market opens, so stay tuned!

Best Regards,
—Noah Zelvis
Everyday Alpha