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Russian (RU) Justin Pope, The Motley Fool
Sat, Apr 26, 2025, 3:32 PM 4 min read
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Gold's value dates back to humankind's earliest years. It remains a safe-haven asset to this day.
The heightened uncertainty in the stock market has caused a literal gold rush. Gold, priced in U.S. dollars, has soared nearly 24% over the past year. But zoom out, and gold is up over 900% since 2000, trouncing the S&P 500 index's 489% over that stretch. Newmont Corporation (NYSE: NEM), the world's largest gold mining company, has surged over 40% year-to-date.
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Should you invest in Newmont Corporation today, or has the opportunity already passed? Here is what you need to know.
Gold is a precious metal that comes from the ground. When you purchase physical gold or a gold-backed ETF, you own some of the existing gold supply. Buying gold mining stocks gives you equity in the reserves, gold that is still in the ground. Newmont is the world's largest gold company, though it also produces copper, silver, zinc, and lead.
Newmont's operations span the globe, encompassing both mining projects that it directly owns and operates as well as those it indirectly manages through joint ventures and other partnerships. Newmont Corporation is similar to a company that drills for oil. Its financial performance is heavily dependent on two factors:
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The quantity of gold and other metals it produces.
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The prevailing market prices for these metals.
People invest in gold for multiple reasons. Its long-standing value and limited supply can make gold a popular hedge against inflation. Additionally, gold is often in high demand during uncertain times, and it is fair to say that the Trump Administration's tariff announcements in early April have clouded the market's outlook, even if the U.S. has since walked back or paused some of these policies.
Historically, gold prices have gone through boom-and-bust cycles. You can see this pattern repeat several times between the late 1970s and today:
Although the long-term direction is upward, gold prices have not been consistently reliable over extended periods of time. It helps explain why Newmont Corporation has returned a total of just 240% since 1989. Nobody knows what the future holds, but history shows that simply buying and holding Newmont Corporation doesn't produce great results.
The timing of when you buy is crucial.
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