Newmont (NEM) Valuation Update Following Upbeat Earnings, Newcrest Integration, and Share Buyback Expansion

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If you have been watching Newmont (NEM) lately, you are not alone. The company has been making headlines after announcing an upward revision in earnings estimates, driven by a stronger-than-expected quarterly report, as well as integration progress following the Newcrest acquisition and a boost to its share repurchase program. Together, these developments have put Newmont back in focus for investors searching for stability and upside in the gold sector.

These strategic steps have strengthened Newmont’s profile, and the stock has responded with an impressive 84% year-to-date rise. This performance is not just a short-term blip. Momentum has been building steadily: Newmont has outpaced the broader market over the past month and maintained its lead over the last year. Even with just modest revenue growth and softer net income, the stock’s resilience reflects a shift in risk perception. Investors are increasingly factoring in disciplined cost controls and a favorable gold price environment.

Now, with so much optimism already reflected in the price, the big question is whether Newmont remains undervalued or if the market has already priced in the next phase of growth.

Most Popular Narrative: 0% Overvalued

According to community narrative, Newmont is considered fairly valued based on the current consensus among analysts. Anticipated catalysts and risks have been carefully weighed in the target price.

"Persistent global inflation and monetary debasement are likely to reinforce investor and central bank demand for gold, which will support higher sustained gold prices and directly increase Newmont's future revenues and earnings. Newmont's focus on operational stability, cost discipline, and productivity enhancements (for example, at Lihir, Boddington, and across its core assets) is expected to drive lower operating costs and improved EBITDA margins. This positions the company for margin expansion and stronger net income over time."

Curious about what makes this valuation tick? Analysts have relied on a powerful combination of industry tailwinds and internal efficiency gains to justify fair value. Think strong gold demand, bigger profit margins, and aggressive financial assumptions. What numbers could push this target even higher or lower? You will want to see what the full narrative reveals.

Result: Fair Value of $70.72 (ABOUT RIGHT)

Have a read of the narrative in full and understand what's behind the forecasts.

However, operational mishaps or lower-grade production declines at key assets could quickly undermine Newmont’s current growth outlook and future revenue forecasts.

Find out about the key risks to this Newmont narrative.

Another View: What Does the SWS DCF Model Say?

While analysts’ consensus relies mainly on industry comparisons and market sentiment, our DCF model looks at Newmont's future cash flows to assess value. Interestingly, this approach currently suggests the shares are undervalued. Which view will prove closer to reality?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Newmont for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Newmont Narrative

If you would like to challenge these conclusions or dig into the numbers yourself, you can build your own viewpoint in just a few minutes and do it your way.

A great starting point for your Newmont research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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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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