Newmont: Fool’s Gold or Just Gold?

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The price of gold, it seems, has decided to take a holiday from reality. It’s currently bobbing around at levels that would make even Rincewind clutch his purse strings tighter.1 Newmont, a company that digs this shiny stuff out of the ground, is naturally doing rather well. They’re posting numbers that, on the surface, look like a winning lottery ticket. But, as any seasoned gambler—or, indeed, anyone who’s ever tried to predict the weather—knows, appearances can be… misleading.

Let’s examine this Newmont, shall we? It’s not just about gold, you see. They dabble in copper, zinc, lead, and silver. A veritable alchemist’s workshop, only instead of turning lead into gold, they’re just… finding it. Their operations stretch across eight countries, which, frankly, sounds exhausting. They managed to wrestle 5.7 million ounces of gold from the earth last year, at a cost of $1,599 per ounce. A respectable haul, though one wonders about the state of the earth afterwards.

They sold that gold for an average of $3,498 an ounce—a 45% increase. That’s the sort of number that makes accountants weep with joy, and common sense take a long holiday. This generated a rather impressive $10.2 billion in cash, and a free cash flow of $7.3 billion. They then, quite predictably, returned $3.4 billion to investors and reduced their debt by the same amount. Leaving them with a net cash position of $2.1 billion. Which, let’s be honest, is a lot of gold doubloons.2

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Positioned for More, They Say

Newmont expects to unearth 5.3 million ounces this year, at a cost of $1,680 per ounce. That’s a slight increase, which they blame on lower volumes, a higher expected gold price (they’re predicting $4,500 in 2026), and increased expenses. It’s always something, isn’t it? With gold currently nudging $5,000, they anticipate even more cash. They plan to invest $1.4 billion in development and pay out $1.1 billion in dividends. They’re also repurchasing shares, because apparently, making things slightly more complicated is a business strategy.3 They have $2.4 billion left in their repurchase pot, just in case the market decides to have a wobble.

An Enticing Prospect?

Newmont is a low-cost gold producer. That much is true. They’re benefiting from high prices, which is also true. They claim they can still generate cash even if prices fall, and use it to buy back shares. Which is a bit like catching raindrops in a sieve, if you ask me. It’s an intriguing way to invest in gold, even at these elevated prices. But here’s the rub: markets have a habit of proving everyone wrong. Especially those who are confidently predicting future prices. This isn’t to say Newmont is a bad company. It’s just… a company. And companies, like people, are subject to the whims of fate, the laws of economics, and the occasional dragon.4

So, should you buy Newmont stock? Well, that depends. Do you believe in magic? Do you have a spare dragon to guard your investment? If not, proceed with caution. And remember: there’s always a catch. There always is.


1 Rincewind, for the uninitiated, is a wizard of… limited talent. And even more limited financial acumen.
2 Doubloons, naturally, are the preferred currency of adventurers, pirates, and anyone who’s ever had to bribe a troll.
3 The Guild of Alchemists and Venture Capitalists insists this is called “maximizing shareholder value.”
4 Dragons, while rare, are known to have a fondness for shiny objects. And a distinct lack of respect for stock portfolios.

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2026-02-23 20:14