Assessing New Gold (TSX:NGD) After A 267% Year Gain And Strong Valuation Signals

Simply Wall St

Sun, February 15, 2026 at 3:08 AM GMT+9 5 min read

In this article:

NGD

+7.07%

GC=F

+1.98%

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If you are wondering whether New Gold shares still offer value after a big run, this article will walk through what the current price could mean for long term investors.

The stock recently closed at US$15.11, with returns of 4.4% over 7 days, 7.0% over 30 days, 28.3% year to date and 266.7% over 1 year. It has also delivered a very large 3 year gain that is around 11x and a 5 year gain of nearly 7x.

Recent coverage around New Gold has focused on its position in the gold mining space and how investors are reacting to that exposure, along with ongoing attention to the sector from those watching precious metals. This backdrop helps frame why the share price has been so active and why expectations about future operations and the gold market are firmly in the spotlight.

On our checks, New Gold currently has a valuation score of 3 out of 6, which suggests some measures point to value while others look more demanding. Next we will walk through the key valuation approaches before finishing with a broader way to think about what that score really means.

New Gold delivered 266.7% returns over the last year. See how this stacks up to the rest of the Metals and Mining industry.

Approach 1: New Gold Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a company could be worth by projecting its future cash flows and discounting them back to today, using a required rate of return. It is essentially asking what those future dollars are worth in present terms.

For New Gold, the latest twelve month Free Cash Flow is $188.5 million. Using a 2 Stage Free Cash Flow to Equity model, cash flows are projected out over ten years, with analyst input where available and then extrapolated. For example, Simply Wall St uses an analyst estimate of $1,712 million FCF in 2026 and $1,795 million in 2027, with later years continuing in the $1.5b to $1.6b discounted range according to the model output.

Bringing all those projected cash flows back to today yields an estimated intrinsic value of $67.65 per share. Compared with the recent share price of US$15.11, this implies the stock is around 77.7% undervalued on this DCF view, which is a very wide gap.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests New Gold is undervalued by 77.7%. Track this in your watchlist or portfolio, or discover 5 more high quality undervalued stocks.

NGD Discounted Cash Flow as at Feb 2026

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for New Gold.

Story Continues  

Approach 2: New Gold Price vs Earnings

For a profitable company like New Gold, the P/E ratio is a straightforward way to think about what you are paying for each dollar of earnings. It links the share price directly to the business’s current earnings, which many investors find easier to interpret than cash flow models.

What counts as a “normal” P/E depends on how the market views growth prospects and risk. Higher growth or lower perceived risk can justify a higher multiple, while slower growth or higher uncertainty usually points to a lower one.

New Gold currently trades on a P/E of 35.24x. That sits above the Metals and Mining industry average of 25.32x and above the peer average of 31.04x. Simply Wall St’s Fair Ratio, which is its proprietary estimate of an appropriate P/E given New Gold’s earnings growth profile, industry, profit margins, market cap and risk factors, is 50.12x.

The Fair Ratio is more tailored than a simple peer or industry comparison because it adjusts for company specific traits rather than assuming all miners should trade on similar multiples. Comparing New Gold’s current P/E of 35.24x with the Fair Ratio of 50.12x indicates that the shares are trading at a discount to that modelled level.

Result: UNDERVALUED

TSX:NGD P/E Ratio as at Feb 2026

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Upgrade Your Decision Making, Choose your New Gold Narrative

Earlier we mentioned that there is an even better way to understand valuation. Let us introduce you to Narratives, which let you pair a clear story about New Gold with your own expectations for future revenue, earnings and margins. You can then link that story to a forecast and a fair value, and compare that fair value with the current price to decide whether the stock looks attractive or expensive at any point in time. All of this is available within Simply Wall St’s Community page, where Narratives are used by millions of investors and automatically update when fresh news or earnings arrive. For example, one investor might build a cautious New Gold Narrative with a fair value around US$17.97, while another might build a much more optimistic one around US$39. By seeing these side by side, you can quickly judge which assumptions you agree with and what that means for your own decision making.

Do you think there’s more to the story for New Gold? Head over to our Community to see what others are saying!

TSX:NGD 1-Year Stock Price Chart

_ This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned._

Companies discussed in this article include NGD.TO.

Have feedback on this article? Concerned about the content? Get in touch with us directly._ Alternatively, email editorial-team@simplywallst.com_

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