Margins Exploding, Records Shattering— Gold Miners' Charge into Uncharted Territory
The gold price tsunami keeps rolling, margins are going parabolic, and miners are swimming in cash – but relative to gold's boom peaks, this surge is still in its early innings.
Life has a funny way of surprising you: you spot a megatrend barreling toward you from miles away—crystal clear, seemingly inevitable. You map out exactly how it will play out. Yet when it finally arrives, it still hits harder than expected.
That’s precisely my vantage point right now, watching the free cash flow tsunami sweeping through the major gold mining companies. They’re smashing record after record—just as the fundamentals predicted—and yet the sheer magnitude of the numbers still packs a real punch.
The big three—Newmont, Barrick, and Agnico Eagle—have just posted record-high free cash flow figures for 2025 (with Q4 numbers setting new benchmarks). Shareholders should brace for meaningfully higher dividends, buybacks, and potentially accretive growth moves.
No wonder gold mining equities continue to outperform physical gold itself, as evidenced by the recent substantial decline in the gold/HUI ratio.
Yet context is key: even as the HUI surges with impressive recent strength—now charging toward (and eyeing a decisive breakthrough above) the psychologically important 1,000 mark—the HUI/gold ratio still sits well below its explosive 2000s bull-market peaks, i.e. the early-2006 all-time high and the dramatic September 2011 spike.
That lingering undervaluation in relative terms? It’s the clearest signal yet that gold miners have plenty of runway left to truly catch fire and deliver outsized leverage to the metal’s ongoing advance. The best chapters for the sector—and its shareholders—are still ahead.
And here’s the kicker: the best is still very much ahead. Let’s not bury the lede: none of this is a shock. It’s the almost mechanical result of three dominant forces converging perfectly:
