Newmont Corporation
Analysis
Newmont has stopped buying growth and started handing cash back: two years of repurchases have cut the share count and the dividend is now built to grow per share, while 2026 is a self-declared production trough management expects to grow out of from 2027. How much of the 2027 recovery rests on Cadia's new caves?
- Cash returns, not acquisitions, are now the plan.
In February management committed a $1.1 billion yearly dividend and every spare dollar to buybacks. Two quarters running, more than 80% of free cash flow went to shareholders, so the share count keeps falling and each share owns more.
- 2026 is a trough Newmont chose, not one it hit.
Output drops as Ahafo South, Peñasquito and Cadia move into lower-grade ore and Yanacocha winds down. Management calls it sequencing and points to about 6 million ounces from 2027 — the dividend is paid before those ounces arrive. Which assets carry the biggest share of the return to 6 million ounces?
- The Nevada joint venture is the problem Newmont cannot fix alone.
Newmont filed a default notice against its partner over how Nevada Gold Mines is run, and in July said talks were near their end. Newmont does not operate that mine, a quarter of group output, so it cannot fix it alone. What happens to Nevada's output if the dispute goes to arbitration?
- Cost discipline and cash conversionThe bull case is that years of cost control have turned high gold prices into free cash flow far faster than the cost base rises, so margins hold even as royalties climb.
- Per-share capital returnsNewmont now returns most of its excess cash through buybacks and a fixed dividend, so the share count falls and each remaining share owns more of the same production.
- Project delivery refills outputDelivery at Ahafo North and the expansions at Tanami, Cadia and Lihir are meant to lift output back after the 2026 low, so the growth case rests on schedule and budget.
- Production trough before growthThe bear case is that output bottoms out before those projects arrive, so unit costs stay exposed to higher royalties and fuel while the fixed cost base keeps running.
- Price-linked cost escalationBecause royalties and profit-sharing agreements rise with the gold price, a larger share of any price gain goes to governments and workers rather than to Newmont.
- Nevada joint venture disputeControl of Nevada Gold Mines sits with a partner Newmont has formally accused of mismanagement, so a large slice of output depends on a relationship it does not run.
| Politician | Transaction | Amount | Traded | Filed |
|---|---|---|---|---|
Donald Trump Republican · Executive | Purchase | ≥$1K | Aug 24 | Oct 8 |
Donald Trump Republican · Executive | Sale | ≥$1K | Jul 24 | Sep 22 |
Donald Trump Republican · Executive | Sale | ≥$1K | Jul 23 | Sep 22 |
Donald Trump Republican · Executive | Sale | ≥$1K | Jun 12 | Aug 22 |
Donald Trump Republican · Executive | Purchase | ≥$1K | May 11 | Jul 1 |
Congressional trading data provided by QuiverQuant
How Newmont turned $22.7B of revenue into $11.0B of operating income.
| Revenue | ||
|---|---|---|
| Gold Dore | $14.3B | ▲ 16.39% YoY |
| Sales From Concentrate And Other Production | $8.3B | ▲ 30.91% YoY |
| Total revenue | $22.7B | |
| Gross profit | $14.6B | 64.3% |
| Operating income | $11.0B | 48.6% |