By Mackenzie Tatananni

As the price of gold continues its impressive trajectory upward, shares of gold miner Newmont aren't just moving in stride, but have overtaken it.

Gold had an impressive run in 2024 and has only exceeded Wall Street's lofty expectations since then, with prices crossing the $3,000-per-ounce mark last month.

Newmont has gained 47% in 2025, beating out the SPDR Gold Shares ETF, which gained just shy of 25% over the same period. Shares have also surpassed the most active gold futures contract, which has risen 26% so far this year.

In addition to positive sentiment around the yellow metal, Newmont's latest earnings were helping drive shares higher on Thursday. The stock was up 3% to $54.73, snapping a two-day losing streak.

The gold miner notched a first-quarter profit of $1.9 billion, up from $179 million a year earlier. Adjusted earnings came in at $1.25 a share, beating the 92 cents analysts had expected, according to FactSet. Revenue rose to $5.01 billion from $4.02 billion a year earlier and topped the $4.7 billion consensus estimate.

CEO Thomas Palmer said on the earnings call that Newmont generated record first-quarter free cash flow and reached a milestone with the completion of its divestment program.

The first-quarter print is a "good start," given Newmont's history of repeatedly missing targets, analysts at UBS argued on Thursday, while also noting that cash returns were accelerating.

The hangup about gold is that it doesn't produce any income, despite its steep price appreciation. Unlike stocks and bonds, gold doesn't generate dividends or interest payments.

This is where Newmont -- and its robust buyback program -- -comes in. Last year, the company said it had repurchased $1.2 billion of shares outstanding under its $3 billion buyback program, which is authorized through October 2026.

With gold trading at a record in March, Newmont logged the largest monthly repurchase of shares since October 2024. The company snapped up more than $340 million of stock in March alone, or 7.5 million shares, at an average price of $45.75 each.

Buybacks totaled $348 million in the first quarter of 2025, Newmont said, plus an additional $406 million in April. This took buybacks to $754 million and total cash returns to more than $1 billion this year alone.

UBS analysts noted that Newmont "remains committed" to returning divestment proceeds and excess free cash flow to shareholders as long as net debt remains below the company's $5 billion target.

The UBS team anticipates that shareholders will reap the benefits of strong free cash flow generation in the near future, "resulting in an attractive high single percent distribution yield in 2025/26."

Analysts with BMO Capital Markets pointed out that free cash flow will likely be somewhat lower in the current quarter due to asset sales in Q1, tax payments, capital expenditures related to its Ahafo North and Cadia projects in Africa, and water treatment at its Yanacocha Norte plant.

Still, the aggressive buybacks in April signal a solid start to 2025. "We see NEM as well positioned to continue executing on operating plans this year and returning capital to shareholders," the firm wrote.

Chalk one up for the miners.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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April 24, 2025 12:22 ET (16:22 GMT)

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