Barrick Gold (GOLD) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
·3 min read

Barrick Gold (GOLD) closed at $27.02 in the latest trading session, marking a -1.99% move from the prior day. This move lagged the S&P 500's daily loss of 1.63%. Elsewhere, the Dow lost 1.44%, while the tech-heavy Nasdaq lost 1.65%.

Coming into today, shares of the gold and copper mining company had lost 5.39% in the past month. In that same time, the Basic Materials sector lost 1.93%, while the S&P 500 gained 2.86%.

Investors will be hoping for strength from GOLD as it approaches its next earnings release, which is expected to be November 5, 2020. The company is expected to report EPS of $0.33, up 120% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $3.25 billion, up 21.46% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1 per share and revenue of $12.44 billion. These totals would mark changes of +96.08% and +28.04%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for GOLD. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 4.94% higher within the past month. GOLD is holding a Zacks Rank of #1 (Strong Buy) right now.

Digging into valuation, GOLD currently has a Forward P/E ratio of 27.71. For comparison, its industry has an average Forward P/E of 18.63, which means GOLD is trading at a premium to the group.

It is also worth noting that GOLD currently has a PEG ratio of 13.85. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Mining - Gold stocks are, on average, holding a PEG ratio of 2.17 based on yesterday's closing prices.

The Mining - Gold industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 103, putting it in the top 41% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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