Chance to buy the dip by TipRanks
© Reuters. Barrick Gold Stocks: Opportunity to Buy Downside
Barrick Gold (NYSE 🙂 is a Canadian mining company and one of the largest gold producers in the world.
The mining house also produces, which has added significant value to revenue growth in recent years.
I am bullish on the stock. (See GOLD stock charts on TipRanks)
Performance, evaluation measures
Barrick Gold has surprisingly underperformed over the past year, with the stock trading down more than 30%. Being positively correlated with gold prices, Barrick climbed sharply alongside gold at the start of pandemic lockdowns.
As gold continued to hover between the $ 1,800 and $ 1,950 an ounce levels, Barrick shares surprisingly suffered a big pullback. This presents a great cash buying opportunity.
Gold has consolidated around the $ 1,800 mark with fears of the Delta variant influencing prices. Copper prices also consolidated above $ 4 a pound after an initial pullback with fears of a shortage of chips.
Barrick Gold is currently trading at a discount to its industry. Its P / E trades at a discount of 12.3% and its EV / EBITDA at a discount of 32%.
Merger of Randgold (LON :), Nevada Gold Mines
Barrick Gold and Randgold merged in 2019 in an action-to-action deal. The results of the merger are tangible, as Barrick has managed to increase its revenues by 34.2% and 29.6% respectively, in the last two full fiscal years.
Another significant change to Barrick’s structure is the creation of Nevada Gold Mines. Newmont mining (NYSE 🙂 and Barrick Gold created Nevada Gold Mines in 2019, with Barrick Gold being the majority shareholder.
The entity operates various underground and surface mines, and Barrick continues to allocate a significant portion of its exploration budget to the entity.
NGM is expected to contribute significantly to Barrick’s earnings going forward. Maintenance work took place at various mines and processing facilities during the second quarter, which increased the company’s expected cost of sales, subsequently lowering earnings expectations (mining stocks and earnings expectations). are closely correlated).
The Taking of Wall Street
Wall Street thinks Barrick Gold is a strong buy, with five unanimous buy ratings. The average GOLD price target of $ 27.48 implies upside potential of 34.8%.
Disclosure: At the time of publication, Steve Gray Booyens does not have a position in any of the titles mentioned in this article.
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