Newmont Sets a High Bar With Record Q2 Free Cash Flow: Will It Last?

Core Insights - Newmont Corporation (NEM) achieved a record quarterly free cash flow of $1.7 billion in Q2 2025, marking a nearly threefold increase year over year and a 42% rise from the previous quarter, driven by higher net cash from operating activities and reduced capital investment [1][7] - Despite the strong performance, there are concerns regarding the sustainability of cash flow into Q3 due to anticipated higher capital spending, increased cash tax payments, and ongoing costs related to the Yanacocha water treatment facilities [2][7] - Newmont's solid balance sheet enables it to fund growth projects and meet debt obligations, indicating that near-term cash flow pressures do not reflect deteriorating fundamentals [3] Financial Performance - Newmont's net cash from operating activities increased by 17% from the prior quarter to $2.4 billion, contributing to the record free cash flow [1] - In comparison, Barrick Mining Corporation reported a free cash flow of $375 million for Q1, a nearly 12-fold increase year over year, while Agnico Eagle Mines Limited generated $594 million in free cash flow, up around 50% year over year [4][5] - Newmont's shares have risen 76.7% year to date, outperforming the Zacks Mining – Gold industry's increase of 58.7% [6] Future Outlook - The Zacks Consensus Estimate projects a year-over-year earnings rise of 35.6% for 2025 and 4.6% for 2026, with EPS estimates trending higher over the past 60 days [8] - Newmont is currently trading at a forward 12-month earnings multiple of 13.57, which is approximately 6.6% above the industry average of 12.73 [9][10] - The stock carries a Zacks Rank 3 (Hold), indicating a neutral outlook [11]