Newmont Mining: Record Rally Faces Operational Test

The past year has seen Newmont Mining, the world's largest gold producer, emerge as a standout leader within the commodities sector. Its share price has surged by 174%, nearly tripling in value as gold itself reaches unprecedented price levels. However, this market euphoria contrasts sharply with the company's operational reality of declining production volumes, raising a critical question for investors: can soaring profits sustainably offset these output challenges?

Financially, the miner exhibits remarkable strength. Following the completion of a strategic divestment program, Newmont operates virtually debt-free while holding liquidity of $9.6 billion. The third quarter saw free cash flow hit a record $1.6 billion. This robust financial position has enabled substantial returns to shareholders; over the last two years, the company has returned more than $5.7 billion through dividends and share buybacks.

The Gold Price Catalyst

The primary engine behind Newmont's stock performance is the historic rally in gold, with prices now quoted above $4,600 per ounce. Investors are seeking safe-haven assets amid geopolitical tensions, notably between the United States and both Venezuela and Iran, coupled with aggressive global tariff policies. Newmont reaps direct benefits from this environment. Its third-quarter 2025 profit doubled compared to the prior-year period. Market experts are forecasting a further increase of approximately 29% in earnings per share (EPS) for the fourth quarter.

Key Financial Metrics:
* Market Capitalization: Approximately $125 billion
* One-Year Share Price Gain: 174%
* Trailing Twelve-Month EPS: $6.43
* 52-Week High: $115.70

Should investors sell immediately? Or is it worth buying Newmont Mining?

The Production Conundrum

Despite these glittering financial figures, Newmont confronts significant operational headwinds. Gold production fell by roughly 15% in the third quarter and is projected to drop by as much as 25% year-over-year in the fourth.

This decline is attributed to several concurrent factors:
* The divestment of non-core business segments
* Lower ore grades being processed at key mine sites
* Scheduled maintenance activities at the Penasquito and Lihir operations
* A fire incident at the Boddington mine in Australia, which is expected to impact first-quarter 2026 output

Wall Street's Verdict and the Road Ahead

Analysts on Wall Street have responded to the mixed picture with revised, yet generally optimistic, targets. Bank of America recently raised its price objective from $114 to $129, while Citi adjusted its target upward to $118. Raymond James also sees further potential, citing the company's low-risk business model. The consensus view among the 29 analysts covering the stock suggests the market believes the mining giant still has room to run, even after its powerful performance.

All eyes are now on February 19, 2026. On this date, Newmont will release its fourth-quarter and full-year 2025 results. The focus for investors will likely shift away from profit figures—which remain buoyed by the gold price—and toward the company's 2026 production forecast and the trend in all-in sustaining costs (AISC). These operational metrics will be crucial in determining whether the company's fundamental efficiency can justify its current market valuation.