Northern Star Resources Ltd (ASX: NST) shares have started 2025 with a bang and are up almost 9% so far this year, finishing Tuesday's session at $16.79 apiece.
That said, shares in the gold miner are still down 8.35% from their all-time high of $18.32, set in October last year.
Indeed, Northern Star mines and produces gold. And, despite a recent rally, the yellow metal itself is down off its October 2024 highs, trading at US$2,742 per ounce at the time of writing.
Can the gold mining stock continue to turn around in 2025? Let's see what the experts think.
Northern Star shares rated a buy
Brokers are bullish on Northen Star shares in 2025 and point to the company's fundamentals with a strengthening gold market. Gold has rallied off its November lows of US$2,562 per ounce, a 7% gain.
Goldman Sachs reaffirmed its buy rating on Northern Star in its most recent analysis on the company in January.
It says the company's production numbers are worth keeping an eye on, especially since its $5 billion acquisition of fellow miner De Grey Mining Ltd (ASX: DEG) last year.
We are positive on the outlook for NST on expanded KCGM operations and other asset growth taking group production toward ~2Mozpa from ~CY27-29+ (and up to ~2.5Moz on proposed acquisition of DEG). With NST going into a 2H production uplift and improving FCF generation.
The broker reckons the company is trading at a discount to its net asset value (NAV), unlike its peer group, which sells at more than 1.1 times, and competitor Evolution Mining Ltd (ASX: EVN) at 1.15 times NAV.
Goldman also projects Northern Star's free cash flow (FCF) to grow 2.5 times in the second half of FY25.
On our LT gold price of US$2,300/oz NST is trading on ~0.9x NAV, or pricing ~US$2,170/oz gold (~US$2,150/oz incl. proposed DEG acquisition; peer average ~1.1x (EVN ~1.15x) and ~US$2,340/oz respectively), and near-term FCF yields of c.5-15% (incl. DEG acquisition) appear increasingly attractive/defensive vs. peers, and support ongoing capital management in through dividends and potential buy-back extensions.
Furthermore, we see any execution risk to the 2Mozpa target more than priced in at these levels, with NST trading close to the deepest discoun since we initiated to closest Australian peer, EVN.
Meanwhile, Bell Potter also retained its buy rating on Northern Star shares in a recent note, setting a $19.55 price target on the stock.
Bell reckons the De Grey acquisition could mitigate Northern Star's long-term production risks.
Zooming out, the consensus of analyst estimates rates the gold miner a buy, according to CommSec data.
Foolish takeout
Brokers are optimistic on Northern Star shares and are projecting them to glide past their previous all-time highs.
This is good news for investors taking a view on the gold miner. But, much of this depends on the price of gold. And who knows what could happen there?
The stock is up almost 30% in the past year.
