Barrick Gold Sparkle Blinds Estimates: Stock To Buy in 2021

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 Barrick Gold Sparkle Blinds Estimates: Stock To Buy in 2021

Summary

  • Barrick Gold revenues were up by 91 per cent to US$5.4 billion in 2020.
  • Its net income was US$616 million in Q4 2020.
  • The company announced a quarterly dividend of US$0.09 per share.

Canadian gold mining company Barrick Gold Corporation (TSX: ABX) on Thursday beat earnings estimates of analysts by registering a record annual cash flow of US$5.4 billion, up by 91 per cent.

Its adjusted net annual earnings were up by 125 per cent to C$1.15 per stock as compared to the previous year. Its total revenues from gold were US$1.8 billion and net income of US$616 million in the fourth quarter ended December 31, 2020.

Barrick stocks were priced at C$26.22 at 9:59 am ET on Thursday. The stocks, however, have witnessed frequent ups and downs over the year, declining by 11 per cent in the past year.

The company has a market cap of US$46 billion and runs operations across various geographies.

It also declared a quarterly dividend of US$0.09 per share, as well as proposed a US$750-million capital return.

Pic Credit: Pixabay.

Should You Buy This Stock?

Barrick’s spectacular performance in 2020 has helped the company to pay up all its outstanding debts, which were at a peak of US$13.4 billion in 2013, making it now a zero-liability entity.

The company has recently secured an improved credit rating of Baa1 from Moody’s.

Presenting the earnings report, Barrick said on Thursday that it had met all its production targets of 2020 and had also managed to significantly reduce its operating costs. Despite COVID, fluctuations in bullion prices, and higher royalty expenses, it has managed to remain profitable.

Another significant milestone has been the company’s sustained progress at some of the big-ticket projects such as Pueblo Viejo, Gounkoto, Veladero, and Bulyanhulu.

The company has successfully executed its expansion and development plans at Pueblo Viejo and Gounkoto, which is an underground mine. And it has doubled its efforts at Veladero and Bulyanhulu.

Key Performance

The company has consistently maintained higher gold production output despite the pandemic.

New extractions helped replace net depletion which held stay on course. But its regular portfolio enhancements also helped consolidate its position in the market.

The exploration activities have yielded new high-grade reserves at most sites, enhancing the earnings potential. Its attributable gold resources increased to 3,300 million tonnes, while the attributable group reserves stood at 1,300 million tonnes.

The yellow metal was traded at US$1,500/oz 1, while copper prices were US$2.75 per pound. Both rates remained unchanged from 2019. Copper reserves stood at 25 billion pounds.

The company reported that it has achieved a 76 per cent replacement of all depletion.

Barrick had stepped up research and development since the merger with Randgold two years ago. The gold company has also begun a process to optimize its research and mining operations.

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