Is the Newmont Rally Running Out of Steam?

Why It Matters

Newmont’s weakening fundamentals could curb gold‑linked equity gains, prompting investors to reassess exposure and consider hedged strategies amid a potentially peaking gold rally.

Key Takeaways

• Newmont cuts 2025‑2026 production forecast by fifteen percent.
• All‑in sustaining cost jumps fifteen percent to $1,651 per ounce.
• Company divests smaller mines, focusing on tier‑one assets in stable jurisdictions.
• Gold rally may be peaking; valuation stretched after 135% price surge.
• Analysts suggest long‑call diagonal spread to leverage bullish outlook.

Summary

The TD Active Trader Live segment centered on Newmont Corporation, the world’s largest gold miner, debating whether its recent rally is losing momentum as gold prices plateau. The hosts framed the discussion against a backdrop of a softer S&P 500, upcoming Fed minutes, and broader market uncertainty, using Newmont as a proxy for gold‑linked equities.

Bull‑side analysts highlighted Newmont’s strategic shift toward high‑quality, tier‑one assets in politically stable regions, a $500 million cost‑saving project that lowered all‑in sustaining costs to just over $1,500 per ounce, and the company’s scale advantage that supports dividend continuity. Conversely, the bear argued that production is set to decline by roughly 15% in 2025‑2026, that sustaining costs have risen 15% to $1,651 per ounce—higher than peers—and that the stock’s valuation is stretched after a 135% rally, leaving it vulnerable to a gold‑price correction.

Key quotes underscored the divide: the bull praised Newmont’s “tier‑one asset portfolio” and “operational scale,” while the bear warned that “they’re digging less gold at higher costs, like a restaurant serving smaller portions at higher prices.” The segment also introduced a long‑call diagonal spread as an options play to capture upside while mitigating cost exposure.

For investors, the debate signals that Newmont’s upside may be limited by production cuts and rising costs, despite its asset quality. Careful assessment of gold price trends, cost discipline, and valuation metrics is essential, and options strategies could provide a way to stay bullish with limited risk.

Original Description

Our trading debaters square off on Newmont Corporation. Does strength in gold still support upside in the stock, or is the momentum fading? We break down both the bull and bear cases and show options strategies traders can use to position either way.

00:00 – Intro

02:53 – Trading Debating

20:20 – On The Radar

To view more episodes, visit: https://youtube.com/playlist?list=PLv1T2ikyy4Y7u1bLnddcFS-iA2WNqmjpP&si=aNPMwm-HzapggMjq and to open your own TD Active Trader account visit: https://www.td.com/TDActiveTraderLive

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