We recently published a list of 14 Best Affordable Stocks to Buy According to Hedge Funds. In this article, we are going to take a look at where Newmont Corporation (NYSE:NEM) stands against other best affordable stocks to invest in.
The broader market has taken a significant hit, dropping 10% from its peak and wiping out $5.28 trillion in market value in just three weeks. It was worth $52.06 trillion on February 19, but it nosedived to $46.78 trillion as of March 14, 2025. Trade tensions under President Trump, weaker economic growth, and low consumer confidence are all playing a role. Plus, the AI stock boom is cooling off – one of Wall Street’s biggest AI players has fallen 17%, and a popular tech-focused ETF is down 16%. However, even after the drop, the wider market is still looking pricey, trading at 24.1 times its trailing earnings, well above its historical average.
Some experts had previously warned that challenges were looming ahead. On January 22, Rob Arnott, the founder of Research Affiliates, sounded the alarm on US big-cap stocks. He pointed out that the Equity Risk Premium (ERP), which measures how much extra return stocks offer over risk-free government bonds, is at one of its lowest levels in history. In simple terms, this means stocks are looking seriously overvalued, and a downturn could be on the horizon. Arnott blames this on soaring valuations, especially in tech, and rising real interest rates. He still sees opportunities in emerging markets and value stocks, but the overall US market, dominated by overpriced tech giants, looks risky. Arnott puts the odds of a bear market at 50% for both 2025 and 2026, which is much higher than usual.
With markets in turmoil, Wall Street is getting nervous. A new CNBC Fed Survey showed that recession fears are climbing fast, with the probability jumping to 36%, the highest in six months, up from just 23% in January 2025. Trade policies, especially tariffs, which have now replaced inflation as the biggest perceived threat to the US economy, are driving these concerns. As a result, economic growth projections for 2025 have been cut sharply, with GDP now expected to grow just 1.7% instead of the previous 2.4% estimate. Investors are worried that policy uncertainty is spiraling out of control. Despite all this, most survey respondents still believe the Federal Reserve will step in with at least two rate cuts this year.
In light of this uncertainty, investors may be wondering how to navigate the market effectively. Given the current market conditions, it is a great time for individuals looking to enter the stock market. A smart approach would be to focus on budget-friendly stocks to minimize potential losses.
A gold mine entry with a conveyor belt transporting minerals from the depths of a shaft.
Our Methodology
For this article, we used the Finviz screener to filter out a list of stocks priced under $50, with P/E ratios below 20 as of March 22. Then, we manually checked which of the resulting stocks were most popular among hedge funds. We gauged hedge fund sentiment around each stock from Insider Monkey’s Q4 database of 1009 elite funds. The list is ranked in ascending order of the number of hedge fund holders in each firm.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Newmont Corporation (NYSE:NEM)
Number of Hedge Fund Holders: 69
Share Price as of March 22: $47.36
P/E Ratio as of March 22: 16.56
Headquartered in Denver, Colorado, Newmont Corporation (NYSE:NEM) is a global mining company specializing in gold production and exploration. It also mines other metals like copper, silver, zinc, and lead. By the end of 2024, the company had 134.1 million ounces of gold reserves, down slightly from 135.9 million in 2023. Its tier-1 assets include 125.5 million ounces of gold, along with 13.5 million tonnes of copper and 530 million ounces of silver reserves. NEM is one of the best affordable stocks to watch out for.
On March 3, Newmont Corporation (NYSE:NEM) announced that it has sold three of its non-core mines, Musselwhite and Éléonore in Canada and Cripple Creek & Victor in Colorado, bringing in $1.7 billion after taxes. The company expects to close two more sales, Akyem in Ghana and Porcupine in Canada, in early 2025, adding another $800 million to its balance sheet. Altogether, Newmont’s divestments could reach $4.3 billion, helping to strengthen its finances and return value to shareholders.
Newmont Corporation (NYSE:NEM) closed 2024 with a strong financial performance, reporting $3.4 billion in net income, $3.48 per share in adjusted net income, and $8.7 billion in adjusted EBITDA for the year. The company generated $6.3 billion in operating cash flow and $2.9 billion in free cash flow, including a record $1.6 billion in the fourth quarter. Newmont also repurchased $1.2 billion in shares and paid $1.1 billion in dividends. NEM ended the year with $3.6 billion in cash and reduced debt by $1.4 billion.
According to Insider Monkey’s fourth quarter database, Newmont Corporation (NYSE:NEM) was a part of 69 hedge fund portfolios, compared to 63 funds in the last quarter.
Overall, NEM ranks 11th on our list of the best affordable stocks to buy according to hedge funds. While we acknowledge the potential of NEM to grow, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. 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.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.