Tactical Buy signal on Barrick Gold (GOLD-US)
Barrick Gold is a $ 41.3 Bn market cap gold mining company principally engaged in the production and sale of gold and copper, as well as related activities, such as exploration and mine development. The Company holds interest in 14 gold mines, including six Tier One Gold Assets. The Company gold mines are geographically diversified and located in Argentina, Canada, Cote d’Ivoire, the Democratic Republic of Congo, the Dominican Republic, Mali, Tanzania and the United States. The Company's copper mines are located in Zambia, Chile and Saudi Arabia.
Barrick gold reported Q4-21 profit and revenue above street expectations. Revenue rose to $3.31 billion from $3.28 billion reported last year, beating markets expectations of $3.17 billion.
The company produced 1.2 million ounces of gold, and 126 million pounds of copper, higher than the about 1.1 million ounces of gold and 100 million pounds of copper produced in the third quarter.
Barrick has been successful in replenishing its gold reserves, too: The miner announced attributable proven and probable mineral reserves of 69 million ounces (1.71 g/t), an increase from 68 million ounces (1.66 g/t) last year. Its gold reserves are also based on a conservative gold price of $1,200/oz.
Barrick expects similar strong results in 2022: It has forecasted total annual gold production to range between 4.2 - 4.6 million oz, in line with 2021 results. 2022 guidance assumes a $1,700/oz gold price (gold currently trades above $1,895/oz), and every $100 change in prices positively impacts EBITDA by $580 million.
Barrick’s intentions to increase its dividend and share buybacks shows that senior gold miners are getting more serious about returning capital back to shareholders – which should lead to more share price gains.
Short term catalyst : shares buy back, Ukrain crisis, inflation
This signal looks consistent with the major bullish trend in Gold and the US basic resources sector, while there is 93% of stocks in bullish tactical signal and 21% in bullish strategic signal.