Gold has dropped to around USD 4,200 an ounce, a 13% slide that Morningstar now calls a bear market. The research firm cut its near-term price assumption and lowered fair value estimates across its gold mining coverage.
Morningstar has cut its near-term gold price assumption after the metal fell to around USD 4,200 per ounce, down 13% since its last update. The firm now assumes gold averages around USD 4,400 from 2026 to 2028, down from USD 4,900, based on the futures curve.
The decline in gold prices has pushed ETF investors toward the exits. Morningstar said ETF outflows have accelerated, consistent with their tendency to be procyclical and to act as the marginal buyers or sellers. Solid central bank buying partially offsets those outflows.
Miner fair values fall across the board
Because price is the biggest driver of miner earnings, Morningstar lowered fair value estimates across its entire gold mining coverage. Even so, the firm still sees the shares as expensive, trading from 30% to 180% above fair value as the market projects the recent bull market to continue.
The cuts vary by company. Evolution's estimate falls the least, by 4% to AUD 4.50 per share, while Northern Star and Perseus decline 5% and 6%, to AUD 14.20 and AUD 3.00. Agnico Eagle and Barrick each fall 6% to $87 and $29 per share, and Kinross and Newmont are both reduced by 7%, to $9.30 and $67.00.
Prices still far above 2022 levels
Despite the recent slide, gold remains up about 150% since late 2022 on worries over tariffs, geopolitical issues, Western fiscal deficits and debt, and a weaker US dollar. Morningstar's midcycle assumption stays at about USD 2,050 from 2030, based on its estimate of the long-run marginal cost of production.
Those elevated prices are driving deal activity. Northern Star is being pressured by activist investor Elliott to sell all or part of the company, while Agnico Eagle recently decided to proceed with its Hope Bay development in northern Canada.
Source: Morningstar
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