Stock Analysis & Valuation Newmont Corporation (NMM.DE)

• Previous Close: €98.31
• Sector Valuation Confidence Level: Moderate

Valuation method	Value, €	Upside, %
Artificial intelligence (AI)	28.60	-71
Intrinsic value (DCF)	28.57	-71
Graham-Dodd Method	20.30	-79
Graham Formula	161.40	64

Strategic Investment Analysis

Company Overview

Newmont Corporation (NMM.DE) is the world's leading gold producer, with a diversified portfolio of assets across the United States, Canada, Latin America, Australia, and Africa. Headquartered in Denver, Colorado, Newmont has a proven track record in gold exploration, production, and reserves, boasting 92.8 million ounces of proven and probable gold reserves as of December 2021. The company also explores for copper, silver, zinc, and lead, reinforcing its position in the broader mining sector. With operations spanning 62,800 square kilometers, Newmont leverages its scale, operational efficiency, and sustainability initiatives to maintain industry leadership. As a key player in the Basic Materials sector, Newmont is a critical component of global gold supply chains, benefiting from stable demand for precious metals as both a store of value and an industrial commodity. The company's strong financials, disciplined capital allocation, and commitment to responsible mining make it a preferred choice for investors seeking exposure to gold and diversified mining assets.

Investment Summary

Newmont Corporation presents a compelling investment case due to its dominant position in the gold mining industry, diversified asset base, and strong financial performance. With a market capitalization of €52.5 billion, the company offers stability with a low beta of 0.32, making it a defensive play in volatile markets. Revenue of €18.7 billion and net income of €3.3 billion in the latest fiscal year underscore its profitability, supported by robust operating cash flow of €6.4 billion. However, investors should monitor gold price fluctuations, geopolitical risks in operating regions, and rising capital expenditures (€3.4 billion), which could impact margins. The dividend yield, though modest, adds to its appeal for income-focused investors. Overall, Newmont's scale, reserve base, and operational efficiency position it well for long-term growth, but macroeconomic factors remain a key risk.

Competitive Analysis

Newmont Corporation holds a competitive advantage as the world's largest gold producer, benefiting from economies of scale, a geographically diversified portfolio, and high-quality reserves. Its operational footprint across stable jurisdictions (e.g., U.S., Canada, Australia) reduces country-specific risks compared to peers focused on single regions. The company's strong balance sheet (€3.6 billion cash, €9.0 billion debt) provides flexibility for strategic acquisitions and organic growth, while its focus on sustainability enhances stakeholder confidence. Newmont's cost efficiency and technological adoption in mining processes further strengthen its margin resilience. However, competition from other major miners like Barrick Gold and Agnico Eagle poses challenges, particularly in high-grade deposits and exploration success. Newmont's merger with Newcrest (pending regulatory approval) could further solidify its dominance but may also introduce integration risks. While its size insulates it from smaller competitors, Newmont must continuously optimize operations to maintain its cost leadership amid inflationary pressures.

Major Competitors

• Barrick Gold Corporation (ABX.TO): Barrick Gold is Newmont's closest competitor, with a strong presence in Africa and the Americas. It boasts high-grade reserves and a joint venture with Newmont in Nevada (Nevada Gold Mines), which enhances operational synergies. However, Barrick has a narrower geographic diversification compared to Newmont and faces higher political risks in regions like Mali and the Democratic Republic of Congo. Its cost structure is competitive but slightly less efficient than Newmont's.
• Agnico Eagle Mines Limited (AEM.TO): Agnico Eagle focuses on low-risk jurisdictions (Canada, Finland, Mexico) and has a reputation for operational excellence. Its strength lies in consistent production growth and exploration success, but its smaller scale limits its ability to compete with Newmont on cost efficiency. Agnico's premium valuation reflects its stable performance, but it lacks Newmont's global diversification.
• AngloGold Ashanti Limited (GOLD): AngloGold Ashanti has a significant presence in Africa and South America but faces higher geopolitical and operational risks. Its cost profile is less attractive than Newmont's, and it has been divesting non-core assets to improve margins. While it offers growth potential in new projects, its reliance on higher-risk regions is a drawback compared to Newmont's balanced portfolio.
• Franco-Nevada Corporation (FNV.TO): Franco-Nevada operates as a royalty and streaming company, providing a lower-risk alternative to traditional miners like Newmont. Its asset-light model generates high margins but lacks direct control over production. While Franco-Nevada offers diversification across commodities, it cannot match Newmont's scale or reserve base in gold.
• Newcrest Mining Limited (NCM.AX): Newcrest (pending acquisition by Newmont) is a major gold-copper producer with strong assets in Australia and Papua New Guinea. Its Cadia mine is one of the lowest-cost gold operations globally, but its geographic concentration in Oceania presents higher regional risks compared to Newmont's global footprint. The merger will likely enhance Newmont's copper exposure and reserve life.