Newmont Goldcorp Corp (NEM)

Conclusion

Newmont Corporation is a gold producer that also explores for copper, silver, lead, zinc and other metals, with operations in the United States, Papua New Guinea, Australia, Ghana, Suriname, Argentina, the Dominican Republic, Chile, Peru, Ecuador, Mexico and Canada. On 2026-11-09 the shares closed at 125.16 USD, giving a market capitalisation of 130.1 billion USD.

The verdict is undervalued. The P/E of 14.08 stands below its historical median of 17.98, and EV/EBITDA of 7.53 sits below its median of 9.44. The discounted cash flow gives 294.66 USD per share at a discount rate of 8.87%, and the fair value band runs from 180.29 to 270.43 USD with a midpoint of 225.36 USD, a margin of safety of 80.1% at the current price. The fair value from historical multiples is 156.06 USD. The reverse DCF implies growth of -0.3% a year, while revenue grew at a 14.7% compound rate over five years and free cash flow per share at 8.2%.

The case rests on returns and balance sheet strength. ROIC of 28.9% stands against a WACC of 8.6%, the company holds net cash with net debt to EBITDA at -0.20, and the Piotroski score is 9 out of 9. The weakest numbers are the five-year share count growth of 6.6% a year, which dilutes shareholders, the price-to-book ratio of 3.65 against a historical median of 1.84, and next-year estimates, which fell 5.2% over 90 days with 10 downward revisions against 3 upward in the last 30 days.

Financial health

Financial strength is green, held up by net cash, interest coverage and a high current ratio. The current ratio is 2.45 and the quick ratio 1.86, while net debt to EBITDA is -0.20 and debt to equity 0.15. Interest coverage is 103.96 times on a trailing basis. The Altman Z-score is 5.09, in the safe zone. The Altman model was designed for manufacturers, so this reading is an approximation for a miner. Insolvency risk: low, about 0.05% by the estimate of the Ohlson model over one to two years, based on year-end 2025 figures. Debt fell 17.9% a year on a five-year basis, measured against revenue growth over the same period.

Earnings quality

Earnings quality is yellow. Cash generation and accounting quality are strong: free cash flow conversion is 1.09 on a trailing basis and 1.63 over five years, and the accrual ratio is -0.06. The Piotroski score is 9 out of 9 and the Beneish M-score of -2.24 is read as unlikely to signal manipulation. Stock-based compensation is small at 0.4% of revenue, and free cash flow after it is 9.98 billion USD. The drag is dilution: the share count has grown 6.6% a year over five years. The company beat earnings estimates in all 8 recent quarters, by 24.1% on average. Estimate revisions are negative, with the current year down 1.8% over 90 days and the next year down 5.2%.

Profitability

Profitability is green. The gross margin is 61.6%, the operating margin 55.0% and the net margin 35.1%, against medians of 21.3%, 16.0% and 7.1% respectively. Operating margin stability is 56.7%. ROIC of 28.9% against a WACC of 8.6% gives a spread that the data classes as value creating, at 20.2%. Return on equity is 25.9%. The DuPont split for year-end 2025 shows a net margin of 31.3%, an asset turnover of 0.40 and an equity multiplier of 1.69, so the return comes mainly from margins rather than leverage. The five-year median ROIC is much lower at 3.8%.

Growth

Growth is green. Revenue grew at compound rates of 23.8% over three years, 14.7% over five and 14.1% over ten. Earnings per share compounded at 12.8% over five years and 31.0% over ten. Free cash flow per share grew 68.8% a year over three years, 8.2% over five and 16.3% over ten. Revenue rose in 7 of the 10 comparable years. Analysts expect earnings per share to grow 8.3% next year. Three-year rates are flattered by a strong recent period, so the five-year rates give the more reliable picture of the trend.

Valuation

Valuation is green. Against their historical medians, the P/E of 14.08 is at a discount of 21.7%, EV/EBITDA of 7.53 at 20.2%, and price to free cash flow of 12.91 at 34.4%. Price to sales of 4.93 is at a premium of 66.8%, and price to book of 3.65 at 98.5%. The free cash flow yield is 7.8%. The DCF gives 294.66 USD per share at a discount rate of 8.87%, with a 2.5% terminal growth rate, and the terminal value makes up 60.8% of the total. The fair value is an estimate built on fixed assumptions, a 5% equity risk premium and capped growth, not a price target. The reverse DCF implies growth of -0.3% a year against revenue growth of 14.7% over five years. The dividend yield is 0.85% and the payout is 10.9% of free cash flow.

Risks

The weak numbers each carry a specific risk. Dilution of 6.6% a year over five years erodes the per-share value of the cash flows, so the DCF and fair value band depend on that trend stopping. A price-to-book ratio of 3.65 against a historical median of 1.84 means the stock is priced well above its book value, which would fall if returns on equity weakened. Negative estimate revisions suggest analysts see near-term earnings pressure despite the record of beats. The company's earnings depend on gold output and prices, which this analysis does not model. Values not available include a debt maturity schedule and revenue by segment, so refinancing risk and the mix of operations cannot be assessed. The Ohlson estimate uses year-end 2025 figures, and the Altman score is an approximation for a miner.