Why We’re Raising Our Price Estimate For Barrick Gold To $19

June 27th, 2016 by Trefis Team

We are raising our price estimate for Barrick Gold to $18.86, which is primarily driven by an improvement in the outlook for gold prices. An increase in macroeconomic uncertainty leading up to, and in the wake of, the UK’s EU referendum has increased risk aversion among investors and consequently, the demand for safe haven assets. This has resulted in a spike in the investment demand for gold and the prices of the commodity. Though the  long term impact of the referendum would depend upon how quickly and amicably the UK and the EU recalibrate their geopolitical and trade relationships, uncertainty created as a result of the outcome of the referendum would certainly boost the short term demand for gold. Moreover, the Fed is unlikely to raise interest rates in the midst of rising global macroeconomic uncertainty, which would provide further support to gold prices. We have accordingly modified our realized price and margin forecasts for Barrick’s gold mining divisions, resulting in our new price estimate for the company.

ABX Change In Price Estimate To $19 Part 3

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Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Barrick Gold

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