Is Newmont (NEM) Undervalued On UBS Backing And Easing Fourmile Payment Concerns?
UBS put Newmont (NEM) in the spotlight after calling it the preferred large cap gold miner, highlighting clearer capital return plans and reduced uncertainty around a potential Fourmile project payment.
Newmont’s recent pullback, with the 7 day share price return down 2.68% and the 30 day share price return down 6.21%, comes after a strong run that left the 90 day share price return at 21.23% and the 1 year total shareholder return at 52.43%. This suggests that momentum has cooled in the short term while longer term holders have still seen substantial gains.
Scan UBS’s preferred pick against a curated group of other producers by comparing Newmont with 36 elite gold producer stocks.
Newmont now trades at a single digit discount to both analyst targets and some fair value estimates after a sharp 1 year run. Is the market rightly cautious or underpricing what UBS sees?
Most Popular Narrative: 7% Undervalued
Against Newmont’s last close at $123.41, the most followed narrative pegs fair value near $132.87, implying a modest valuation gap that hinges on how its asset base and cash generation evolve from here.
The realization of synergies and increased production scale following the Newcrest Mining acquisition, together with ongoing asset optimization and the ramp-up of expansion projects (such as Ahafo North and Tanami), is expected to contribute to long-term revenue and cash flow stability.
See why 155 investors see Newmont as 7% undervalued.
Result: Fair Value of $132.87 (UNDERVALUED)
Still, the Newmont story can change quickly if periods of lower grade at key mines or higher sustaining and remediation spending start to bite into cash generation.
Find out about the key risks to this Newmont narrative.
Next Steps
Feeling pulled between optimism around Newmont and concern about potential bumps ahead? Act while the information is fresh and weigh both sides by checking the 4 key rewards and 1 important warning sign.
Looking for more investment ideas beyond Newmont?
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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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