Newmont Shares Retreat as Investors Secure Profits

Newmont Mining US6516391066

Shares of Newmont Mining, the world's largest gold producer, underwent a significant pullback on Thursday, cooling off after an extraordinary rally. This movement represents a classic pattern of profit-taking following an overheated advance, with the stock having surged nearly 200 percent over a one-year period.

The primary driver behind Newmont's remarkable performance has been the historic rise in the price of gold. Geopolitical tensions and expectations of further interest rate cuts in the United States propelled the precious metal to record highs above $5,000 per ounce. For Newmont, this environment translated into a staggering annual gain of 194 percent.

Overbought Conditions Trigger Sell-Off

The correction was prompted by severely overbought market conditions. Newmont's 14-day Relative Strength Index (RSI) reached 82.3, a reading well above the critical 70 level that analysts use to identify overextended valuations. Consequently, the company led the list of the most overbought equities on Wall Street.

Trading activity on Thursday underscored the shift in sentiment. The stock declined by 3.8 percent to close at approximately $127. Earlier in the week, it had established a new 52-week high of $134.88. The sell-off was accompanied by a trading volume that surged 52 percent above the average, indicating heightened selling pressure.

Analyst Outlook Remains Positive

Despite the near-term pullback, market experts maintain an optimistic stance. Analysts at Scotiabank recently raised their price target to $152, while Canaccord Genuity lifted its target to $140. The consensus recommendation for Newmont's stock continues to be "Buy."

Upcoming Quarterly Report

Attention now turns to the company's forthcoming financial results. Newmont is scheduled to release its fourth-quarter 2025 figures on February 19. Market researchers anticipate earnings per share of $1.97 for the final quarter and $6.39 for the full year. Given the supportive gold price environment, expectations are for solid results, though the key question is whether they will be strong enough to surpass the elevated market expectations already in place.