Is Newmont Stock Outperforming the S&P 500?

Denver, Colorado-based Newmont Corporation (NEM) is one of the world's leading gold mining companies, engaged in the exploration, production, and sale of gold, as well as other minerals like copper, silver, lead, and zinc. Valued at a market cap of $47.7 billion, the company operates mining assets across North America, South America, Australia, and Africa.

Companies valued at $10 billion or more are typically classified as “large-cap stocks,” and Newmont fits the label perfectly, with its market cap exceeding this threshold. Newmont’s century-long reign in gold mining, strategic acquisitions, and vast reserves have solidified its market cap, making it a heavyweight within the gold industry.

This gold mining company is currently trading 27.8% below its 52-week high of $58.72, reached on Oct. 22, 2024. NEM has gained 1.5% over the past three months, outperforming the broader S&P 500 Index’s ($SPX) 7.7% loss during the same time frame.

In the longer term, NEM has rallied 21.8% over the past 52 weeks, considerably outpacing SPX’s 9.7% return. Moreover, on a YTD basis, the stock is up 15.3%, compared to SPX’s 4.5% decline over the same time frame. 

To confirm its recent bullish trend, NEM has been trading above its 50-day moving average since mid-January. However, it has remained below its 200-day moving average since mid-November, with some fluctuations. 

Newmont released its Q4 earnings results on Feb. 20. Shares of the company rose after hours, delivering better-than-expected Q4 adjusted earnings of $1.40 per share, which increased by a whopping 204.3% from the year-ago quarter. Moreover, its revenue advanced 42.8% year over year to $5.7 billion. Higher gold production, increased sales volumes, and a rise in realized gold prices led to its strong performance. However, the company’s all-in-sustaining costs (AISC) for gold decreased by 1.5% compared to Q4 2023, further supporting its results.

However, Newmont has massively lagged behind its rival, Agnico Eagle Mines Limited (AEM), which soared 80.9% over the past 52 weeks and 28.7% on a YTD basis. 

Looking at NEM’s recent outperformance, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from the 18 analysts covering it, and the mean price target of $53.30 suggests a modest 22.6% premium to its current levels.