We recently compiled a list of the 11 Best Gold Stocks for Inflation. In this article, we are going to take a look at where Newmont Corporation (NYSE:NEM) stands against the other gold stocks.
History has shown that gold has always been one of the most secure stores of value, especially during times of economic uncertainty and downturns. This is also apparent from the sheer size of the global gold market, which Fortune Business Insights has forecasted to increase from $291.68 billion in 2024 to $457.91 billion by 2032. With looming concerns of trade wars and inflation, the surge in gold demand led gold prices to an all-time high of $2,830.49 per ounce on February 3, 2025, as reported by Reuters.
Gold posted a one-year return of 43.83%, surpassing the broader market’s 20.89% return for the same period, as reported on Yahoo Finance. In 2024, gold ETFs marked their best performance since 2010 as they surged 26%. Gold futures jumped over 1% to $2,670 per ounce. The Gold ETF holds a rating of 79 and trades above its 50-day moving average. Over the past six months, gold prices rose from $2,500 per ounce on August 5, 2024, to $2,830.49 per ounce on February 3, 2025. This 17.09% increase stemmed from concerns about rising inflation and tariffs imposed by President Donald Trump, including a 25% on Canadian and Mexican imports and a 10% levy on Chinese goods. All these factors, along with market volatility, have further pushed the demand for gold upwards.
Furthermore, according to Reuters, trade obstructions around the globe have also increased inflationary pressures. Tariffs imposed by China-including 15% on U.S. coal and LNG and 10% on crude oil and machinery-are projected to increase global trade costs by $50 billion in retaliation. This rise in production costs and inflationary pressures, coupled with supply chain disruptions, will further set the stage for gold to remain one of the best sources of hedging in the face of economic instability.
Given this surge in demand and importance, gold prices are forecast to remain between $2,905 and $4,042 in 2025. Analysts at JPMorgan expect gold to reach $3,000 per ounce in 2025 due to economic instability and strong central bank demand.
Inflationary pressures in the United States are also expected to persist. A U.S. inflation indicator, the Personal Consumption Expenditures (PCE) Price Index, increased to 0.3% in December 2024, marking its highest monthly gain since April 2024. During the last quarter of 2024, consumer spending increased by 0.7%, while labor costs surged by 0.9%.
On the other hand, supply and demand are key drivers of the gold market. Due to higher premiums offered in U.S. gold futures markets, gold is unexpectedly flowing from Dubai and Hong Kong to the United States. Hence, according to Reuters, U.S. Comex gold inventories have been experiencing a prominent increase. A report discussed in an Insider Monkey article has also projected increased demand by the central bank in 2025, exceeding the long-term average of 500 tons, further supporting gold prices.
As evident from the discussion above, gold has established itself as one of the most important assets for preserving value against inflation and continues to hold that title.
Methodology
To create our list of the 11 Best Gold Stocks for Inflation, we identified the most valuable gold stocks with a market cap greater than $500 million. We then shortlisted stocks that reported a dividend yield of at least 1% as of the time of writing. This ensured that these companies provided a good hedge against inflation. From these, we selected the top 11 stocks and arranged them in ascending order based on hedge fund sentiment, according to Insider Monkey’s database of Q3 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A gold mine entry with a conveyor belt transporting minerals from the depths of a shaft.
Newmont Corporation (NYSE:NEM)
Number of Hedge Fund Holders: 61
Dividend Yield: 2.23%
Newmont Corporation (NYSE:NEM) is one of the two largest gold mining companies in the world, as you can see here. It owns large reserves and diversified assets that make it one of the key players in the global market. The company’s operations span the globe, including North America, South America, Australia, and Africa.
During the third quarter ended September 30, 2024, Newmont Corporation (NYSE:NEM) reportedly produced 1.7 million ounces of gold and 430,000 gold-equivalent ounces from copper, silver, lead, and zinc. With these impressive production figures, the company generated $1.6 billion in operating cash flow and $760 million in free cash flow, signaling robust financial health.
Similarly, the company’s adjusted EBITDA reached $2 billion, while its adjusted net income stood at $0.81 per diluted share. To further improve its financial health, Newmont Corporation (NYSE:NEM) retired $233 million in debt and ended Q3 with $7.1 billion in total liquidity. The company was able to perform well overall due to favorable prices of gold (up by $171 per ounce over the previous quarter) and increased production at the Cerro Negro mine. As a result, the company declared a dividend of $0.25 per share while returning a total of $786 million to shareholders through share repurchases and dividend payments.
In line with its past performance, the company expects an even more promising future, with projected gold production reaching 1.8 million ounces in Q4 2024 and realized gold prices at $2,500 per ounce. However, all-in sustaining costs are expected to be $1,475 per ounce due to rising labor inflation and capital spending, especially in Cadia. To counter these issues, Newmont aims to grow its margin instead of volume, aided by low-cost production expected from Tanami and Ahafo North. The company also has plans to earn up to $1.5 billion from selling non-core assets. This will further boost the company’s financial flexibility, making it an excellent choice for the best gold stocks for inflation.
Overall NEM ranks 1st on our list of the best gold stocks for inflation. While we acknowledge the potential of NEM as an investment, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NEM but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.