Gold-mining stocks have struggled to match the rise in gold prices, but Barrick Gold is poised for a breakthrough in the coming year.
While gold prices have surged by over 10% to reach $2,036 an ounce, Barrick shares have only seen a modest 3% increase. Factors such as rising costs and lower-than-anticipated gold production can be blamed for this disparity.
However, Barrick Gold possesses several strengths that set it apart from its competitors. With a portfolio that includes some of the world’s finest mines in Nevada, the Dominican Republic, and Africa, the company is well-positioned to capitalize on future opportunities. In fact, it aims to achieve a 30% increase in mine output – primarily in gold with some copper – by the end of this decade.
One of the key reasons for Barrick’s bullish prospects is its exceptional CEO, Mark Bristow. Known for his hands-on management style, Bristow visits each major mine at least three times a year. He is also adept at fostering positive relationships with host countries in the developing world, which is crucial for the success of mining operations.
Independent analyst Keith Trauner praises Barrick, stating, “Barrick probably has the best management in the mining business, an excellent balance sheet with virtually no net debt, and a well-covered 2.3% dividend yield.” With the stock trading at approximately 16 times next year’s projected earnings, it represents an attractive investment opportunity.