Why Newmont (NEM) Is Up 8.4% After Beating Q3 Earnings on Strong Gold Prices Despite Lower Output

• Newmont Corporation recently reported its fiscal Q3 2025 results, surpassing Wall Street expectations for both revenue and earnings per share as strong gold prices drove growth, despite a 4% decline in gold production linked to lower grades and planned mine shutdowns.
• An interesting aspect is that Newmont's higher earnings were achieved even as operational output decreased, highlighting the significant impact of commodity market conditions on the company's results.
• We will now explore how Newmont's earnings beat, primarily fueled by higher gold prices, affects the company's broader investment narrative.

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Newmont Investment Narrative Recap

To be a Newmont shareholder, you generally need confidence in sustained global demand for gold, operational stability, and cost discipline, factors that underpin prospects for future revenue and earnings. The recent earnings beat, driven primarily by higher gold prices despite slightly weaker production, reinforces the importance of gold market conditions as the key short-term catalyst, while operational risks remain, but appear unaffected in the near term by this result. Among recent updates, the successful ramp-up of commercial production at Ahafo North in Ghana stands out. This project is expected to incrementally boost Newmont's annual gold output over the next decade, serving as a timely offset to planned declines at other key assets and directly supporting the company’s growth and diversification aims. However, it’s important for investors to keep in mind that despite strong results, pressures from rising sustaining and development capital expenditures may...

Read the full narrative on Newmont (it's free!)

Newmont's outlook anticipates $21.6 billion in revenue and $6.4 billion in earnings by 2028. This is based on an assumed annual revenue growth rate of 1.6% and a $0.2 billion increase in earnings from the current $6.2 billion.

Uncover how Newmont's forecasts yield a $103.42 fair value, a 14% upside to its current price.

Exploring Other Perspectives

Ten members of the Simply Wall St Community have forecast Newmont’s fair value to range from US$51.36 to US$126.23 per share. While community estimates vary widely, analysts caution that rising capital costs could pressure future margins if gold prices falter, consider how these views might influence your outlook.

Explore 10 other fair value estimates on Newmont - why the stock might be worth as much as 39% more than the current price!

Build Your Own Newmont Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Newmont research is our analysis highlighting 4 key rewards that could impact your investment decision.
• Our free Newmont research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Newmont's overall financial health at a glance.

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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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