Is Newmont a Hidden Opportunity After Its 113.7% Surge in 2025?

• Wondering if Newmont could be a hidden gem or if you might be paying top dollar? You are not alone. Many investors are looking for clarity on whether the current price is justified by future prospects.
• Newmont’s stock has been on a wild ride, surging 113.7% year-to-date and 93.1% over the past year, but it dropped 8.6% in the last week alone. This hints at shifting investor sentiment and possible opportunities.
• Recent news surrounding Newmont includes increased attention on gold prices and global mining activity, fueling discussions about the company’s future performance. Major investment houses have weighed in on the potential impact of geopolitical tensions and inflation trends, which has only added to the conversation about its recent price swings.
• Looking at the numbers, Newmont boasts a stellar valuation score of 6 out of 6, which means it is undervalued in every major check we use. Up next, we will zoom in on those valuation models and, for those seeking an edge, stay tuned for a deeper way to make sense of what value really means for this stock.

Newmont delivered 93.1% returns over the last year. See how this stacks up to the rest of the Metals and Mining industry.

Approach 1: Newmont Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow (DCF) model works by estimating the total value of a company based on its expected future cash flows, then adjusting those projections back to today's dollars to reflect their present value. This approach gives investors a sense of what the company is really worth compared to its current market price.

For Newmont, analysts use a two-stage Free Cash Flow to Equity model. The company's Free Cash Flow (FCF) for the last twelve months was $5.34 billion. Based on analyst consensus and further extrapolations, Newmont's FCF is projected to increase over time, reaching around $8.68 billion in 2035. Most growth estimates for the next five years come from direct analyst input, with longer-term numbers extrapolated for additional perspective.

According to these forecasts, Newmont's intrinsic value is calculated at $126.61 per share. At present, the DCF approach signals that the stock is trading at a 35.2% discount to its intrinsic value, suggesting that shares are significantly undervalued compared to what the future cash flow projects.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Newmont is undervalued by 35.2%. Track this in your watchlist or portfolio, or discover 920 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Newmont.

Approach 2: Newmont Price vs Earnings

For profitable companies like Newmont, the Price-to-Earnings (PE) ratio is a popular way to evaluate whether a stock is reasonably priced. It shows how much investors are paying for each dollar of current earnings. The PE ratio is especially relevant when profits are reliable and results are not heavily influenced by outside factors. This makes it a trusted barometer for established, income-generating businesses.

What counts as a “normal” or “fair” PE ratio depends on more than just earnings. Companies expected to grow quickly or that carry less risk usually trade at higher PE multiples, while slower-growth or riskier stocks tend to have lower PE ratios. Investor appetite for the broader sector also plays a part in shaping sensible benchmarks.

Right now, Newmont’s PE ratio stands at 12.45x. This is notably lower than the Metals and Mining industry average of 20.45x and a peer group average of 23.73x. Simply Wall St’s proprietary Fair Ratio for Newmont is 22.77x. This Fair Ratio factors in not just industry standards, but also Newmont’s specific outlook, including expected earnings growth, profit margins, company size, and other unique business risks.

The Fair Ratio is a superior benchmark for valuation because it goes far beyond basic peer comparisons. It personalizes what a fair PE should look like for Newmont by blending both the company’s unique potential and risk profile with the realities of its market and sector. When we compare Newmont’s actual PE of 12.45x to its Fair Ratio of 22.77x, the result is a stock that appears significantly undervalued based on its earning power and growth prospects.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1424 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Newmont Narrative

Earlier we mentioned that there's an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is your personal story or perspective on a company, where you set out your assumptions, such as how much you think Newmont’s revenue and profits might grow, what future margins look like, and what fair value you believe is justified. Narratives make investing more human by linking your view of Newmont’s future to real financial forecasts and a fair value estimate, allowing you to see how your outlook compares with others and with the market price.

Anyone can build a Narrative easily on Simply Wall St, right on the Community page, using real data and their own expectations. Millions of investors already do this. Narratives help you make buy and sell decisions by showing if your Fair Value is above or below the current Price. In addition, Narratives are dynamic and update as new news or earnings results come in, so your view always stays current.

For Newmont, some investors see robust gold prices and successful integration of acquisitions driving long-term upside with a fair value well above $100, while others are more cautious due to operational risks and set fair value closer to $58. The key is that you can transparently compare and refine your view in real time.

Do you think there's more to the story for Newmont? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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